The euro area’s economic recovery will remain gradual and uneven and there are risks to growth from the region’s debt crisis, Ireland’s central bank said.
“The underlying momentum of economic activity in the euro area remains positive and is expected to continue to recover gradually,” the Dublin-based central bank said in its quarterly bulletin today. Growth will probably continue at a “gradual and uneven pace,” it said.
The central bank also said the recovery in the U.S. economy has been “weaker than expected” and the outlook for the U.K. remains “uncertain.” A report on July 28 showed European economic sentiment declined this month as the sovereign-debt turmoil clouded prospects. European leaders agreed on a second bailout for Greece last week in a bid to restore investor confidence and stop the crisis from spreading.
“The latest available indicators point toward a continued positive underlying momentum of economic activity,” the central bank said. “However, growth is expected to slow down following the exceptionally strong first quarter.”
“Risks to the outlook relate to ongoing tensions in the sovereign-debt markets,” it said.
The central bank said euro-area inflation is “likely to remain above” the European Central Bank’s 2 percent target “for the remainder of the year before moderating thereafter.” The ECB has raised its benchmark interest rate twice this year, to 1.5 percent, which the Irish central bank said was a response to “upside risks to price stability.” It didn’t comment on the outlook for monetary policy.
Source: www.bloomberg.com
“The underlying momentum of economic activity in the euro area remains positive and is expected to continue to recover gradually,” the Dublin-based central bank said in its quarterly bulletin today. Growth will probably continue at a “gradual and uneven pace,” it said.
The central bank also said the recovery in the U.S. economy has been “weaker than expected” and the outlook for the U.K. remains “uncertain.” A report on July 28 showed European economic sentiment declined this month as the sovereign-debt turmoil clouded prospects. European leaders agreed on a second bailout for Greece last week in a bid to restore investor confidence and stop the crisis from spreading.
“The latest available indicators point toward a continued positive underlying momentum of economic activity,” the central bank said. “However, growth is expected to slow down following the exceptionally strong first quarter.”
“Risks to the outlook relate to ongoing tensions in the sovereign-debt markets,” it said.
The central bank said euro-area inflation is “likely to remain above” the European Central Bank’s 2 percent target “for the remainder of the year before moderating thereafter.” The ECB has raised its benchmark interest rate twice this year, to 1.5 percent, which the Irish central bank said was a response to “upside risks to price stability.” It didn’t comment on the outlook for monetary policy.
Source: www.bloomberg.com
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