Christine Lagarde predicts current quarter contraction in eurozoneEuropean Central Bank president Christine Lagarde, says the overall economic situation is expected to improve over 2021.
But, there remains uncertainty over the near-term economic outlook, relating in particular to the dynamics of the pandemic, and the speed of vaccination campaigns, she says, The Guardian reports.
Persistently high rates of coronavirus infections, the spread of virus mutations, and the associated extension and tightening of containment measures are weighing on the eurozone economy in the short term, she adds.
On inflation, she says underlying pressures remain subdued, with the overall inflation outlook broadly unchanged.
She warns that eurozone GDP is likely to contract again in the current quarter due to the ongoing pandemic and national lockdowns.
“Incoming economic data... point to continued economic weakness in the first quarter of 2021, driven by the persistence of the pandemic and the associated containment measures. As a result, real GDP is likely to contract again in the first quarter of the year.”
That would follow a contraction in the fourth quarter of 2020.
Source: The Standard
https://www.thestandard.com.hk/breaking ... n-eurozone
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