FRANKFURT, Oct 14, 2008 (AFP) - Huge rescue plans drawn up by eurozone governments for banks do not mean officials have 'carte blanche' to loosen public purse strings, the European Central Bank's chief economist said Tuesday.

Aid packages were not 'a carte blanche (blank cheque) for eurozone governments to freely widen budget deficits and public debt,' Juergen Stark told the German financial daily Boersen Zeitung in an interview.

'Criteria of the European Stability Pact must be respected,' Stark stressed in reference to European Union rules that bind eurozone members to maintaining deficits and debt within defined limits.

Efforts designed to resolve the financial crisis could push several eurozone countries beyond those limits.

The ECB economist nonetheless acknowledged that 'concerted action by eurozone governments to deal with the crisis is an important step towards reinstating confidence' in the banking system.

Governments around the globe have launched a multi-pronged attack on the problem, providing cash for banks in exchange for equity, backing loans to unblock frozen lending between commercial banks, and in some cases buying up bad debts.

Stark warned that governments were taking an 'enormous risk' in providing guarantees for interbank loans, which several economists have said is a key step towards getting lending back on track.

The measure could ultimately prove counterproductive if investors determined that all risks could not be covered by state guarantees, he added.

'That is why guarantees must focus on certain market segments, such as new credit lines,' Stark said.

The ECB economist added that the bank's decision last week to slash its main lending rate to 3.75 percent was not at odds with its focus on keeping prices stable.

The bank was still concerned about inflation, but according to Stark, 'in the second half of 2009, it will approach the limit' of just below 2.0 percent that the ECB has set as a target.

In September, eurozone inflation stood at 3.6 percent after hitting a record 4.0 percent in July.

'Price stability is not only our contribution to financial stability, but also the necessary condition for economic growth and job creation,' he said.