June 2, 2016 / 12:40 PM / 18 days ago

ECB expects growth slowdown, but estimates likely out of date

    FRANKFURT, March 12 (Reuters) - The European Central Bank
cut its growth forecasts for this year and next on Thursday but
said the new estimates, which were collated before the
coronavirus outbreak in Europe, were probably already out of
date.
    The ECB said it now expects the euro zone's economy to grow
by 0.8% this year, 1.3% in 2021 and 1.4% in 2022. This compares
to an expansion of 1.1% for 2020 and of 1.4% for each of the
following two years projected in its December forecasts.
    ECB president Christine Lagarde said risks to that outlook
were "clearly on the downside", and that the coronavirus
epidemic had added a "substantial" negative element.
    "Euro area growth is expected to regain traction over the
medium term," she told a news conference after the bank left
interest rates unchanged. 
    The inflation projections were left unchanged at 1.1%, 1.4%
and 1.6%.
    The cut-off date for the ECB's economic forecasts is usually
three weeks before they are presented to the policy-making
Governing Council.
    The following are the ECB staff's new projections for
inflation and GDP growth, with December forecasts in brackets.  
  
    The ECB updates projections once a quarter.
    
                 2020        2021        2022
GDP growth    0.8 (1.1)   1.3 (1.4)   1.4 (1.4)
Inflation     1.1 (1.1)   1.4 (1.4)   1.6 (1.6)

 (Reporting by Francesco Canepa and John Stonestreet; Editing by
Catherine Evans)
  
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