ECB raises 2010 growth forecast

2nd December 2010, Comments 0 comments

The European Central Bank on Thursday raised its growth forecast for the 16-nation eurozone this year, with the economy now expected to expand by 1.7 percent before slowing to 1.4 percent in 2011.

In 2012, the 16-nation economy is tipped to expand in a range with a midpoint of 1.7 percent, ECB President Jean-Claude Trichet told a press conference in Frankfurt.

In September, the ECB had forecast growth at 1.6 percent in 2010 and 1.4 percent in 2012.

The ECB also said inflation in the eurozone would come to 1.6 percent in 2010 and 1.8 percent in 2011, rather than a previously estimated 1.7 percent.

For 2012, bank staff gave an initial inflation forecast of 1.5 percent.

The new estimates remained well below the ECB's medium-term inflation target of just under 2.0 percent.

ECB policymakers meanwhile left the bank's benchmark interest rate a record low 1.0 percent, as was widely expected.

© 2010 AFP

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