In her usual press conference after the meeting, the President of the ECB, Christine Lagarde said the war in Ukraine is going to have a major impact on economic activity and inflation in the eurozone.
“The extent of the effects depends on the evolution of the conflict,” he said, adding that “the ECB considered a number of scenarios at its meeting. risks to the economic outlook have increased and are now tilted to the downside. Higher energy costs could drag down demand.”
“The eurozone’s recovery has been boosted in recent times by declining Covid-19 infection rates and further developments in the labor market. However, growth estimates have been revised downwards in the short term, while inflation is now considered broader. Long-term inflation expectations have become anchored again at the 2.0% target,” Lagarde said.
“The ECB board considers it increasingly likely that inflation will stabilize near the 2.0% target, although inflation could be considerably higher in the near term. The path for interest rates will be determined by forward guidance,” he noted. the president of the ECB.
New growth and inflation forecasts for the eurozone
- The GDP growth is now seen at 3.7% in 2022 (vs. 4.2% prior), 2.8% in 2023 (vs. 2.9% prior), and 1.6% in 2024 (no change).
- The Headline IPCH is now expected at 5.1% in 2022 (vs. 3.2% prior), 2.1% in 2023 (vs. 1.8% prior), and 1.9% in 2024 (vs. 1.8% prior).
Source: Fx Street
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
