La European Central Bank cuts forecasts on the trend of GDP and inflation in the Eurozone. The data emerge from the latest quarterly survey of the Eurotower, published this morning, which represents an average of the estimates of institutes and external study centres.
On the front of the gross domestic product, experts are now forecasting the following trend: +0,8% in 2014, +1,2% in 2015 and +1,5% in 2016. Three months ago, 2014 growth was forecast at 1%, followed by a + 1,5% in 2015 and +1,7% in 2016.
As for theinflationforecasts have worsened on all time fronts: expected inflation for 2014 is now at 0,5% (from 0,7% three months ago), for 2015 at 1% (from 1,2%) , on 2016 to 1,4% (from 1,9%). The official objective of the ECB is to have a cost of living below but close to 2% per year.
In the euro area we are witnessing “a weakening of the growth momentum– warns the European Central Bank in its latest monthly bulletin -. Risks to the economic outlook remain tilted to the downside. In particular, the weakening of the growth dynamics, together with the intensification of geopolitical risks, could have repercussions on the climate of confidence and above all on private investments”.
In addition, “insufficient progress – continues the ECB – on the front of structural reforms in the countries of the area they represent a crucial downside risk factor for the economic prospects”. According to the monetary institution, "it is probable that high unemployment, the large unused productive capacity and the necessary balance sheet adjustments in the public and private sectors will continue to hold back the recovery".
The Governing Council then reiterates that it is “unanimous in its commitment to resort to other unconventional tools within the framework of its mandate” and entrusted the experts of the ECB with the task of ensuring the timely preparation of further measures to be implemented if necessary”.
Finally, as also pointed out yesterday by Mario Draghi in Rome, according to the ECB, the countries of the euro area that still have imbalances in public finances "should not frustrate the progress already made, but proceed in line with the rules of the Stability and Growth Pact, which must remain the anchor of confidence in the soundness of public finances. The flexibility allowed by the current rules should allow governments to meet the budgetary burdens associated with major structural reforms, to support demand and to achieve a more growth-friendly composition of budgetary policies”.
