June 6, 2019 / 12:53 PM / 20 days ago

ECB revises growth and inflation forecasts

    VILNIUS, June 6 (Reuters) - The European Central Bank sees
slightly higher growth and inflation in 2019 than previously,
but marginally cut its forecasts for the next two years on
Thursday, acknowledging the risk that Europe's slowdown will be
longer and deeper than expected.
    ECB President Mario Draghi told a news conference that risks
to the euro area economy remain tilted to the downside, citing
geopolitical uncertainty, the rising threat of protectionism and
vulnerabilities in emerging markets.  
    With a global trade war weighing on confidence, industrial
production and exports have taken a dip, exacerbated by a string
of domestic difficulties, from German industry's struggles to
Italy's looming budget fight with the European Commission.
    But solid wage growth, record-high employment and healthy
first quarter growth figures suggest the economy is still
resilient, reinforcing the ECB's expectations that the recovery
is delayed, not derailed.
    The following are the ECB staff's new projections for
inflation and GDP growth, with March forecasts in brackets.
    The ECB updates projections once a quarter.

                2019        2020       2021
GDP growth   1.2 (1.1)   1.4 (1.6)   1.4 (1.5)
Inflation    1.3 (1.2)   1.4 (1.5)   1.6 (1.6)

 (Reporting by Balazs Koranyi; writing by Catherine Evans;
editing by John Stonestreet)
  
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