In the latest monthly bulletin, ECB reiterated that recent data confirms “slower growth momentum extending into the current year”. And, “global headwinds continue to weigh on euro area growth developments”. Risks remain “tilted to the downside”, ” on account of the persistence of uncertainties related to geopolitical factors, the threat of protectionism and vulnerabilities in emerging markets.” “Ample degree of monetary accommodations remains necessary”.

On Eurozone growth, ECB noted that the slowdown in has continued, as incoming data have overall been weaker than expected in the first quarter of 2019. Consumer spending continued to rise, albeit at a lower growth rate than in previous years. However, labour markets remain robust, despite some slowdown. Also, recent short-term labour market indicators continue to point to positive but moderating employment growth in the first quarter of 2019. Private consumption is expected to continue to rise at robust rates.

ECB also noted that and short-term indicators point to a possible further slowdown in business investment. in the first quarter of 2019. Trade regained some momentum at the start of 2019 but according to leading indicators it may be short-lived. Overall, the latest economic indicators suggest a sizeable moderation in the pace of economic expansion. This moderation reflects in part a slowdown in external demand, compounded by some country and sector-specific factors.

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Full ECB Monthly Bulletin here.

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