ECB sees 'enormous' degree of uncertainty on global economy

8th September 2011, Comments 0 comments

European Central Bank President Jean-Claude Trichet said Thursday he saw an "enormous degree of uncertainty" surrounding both the world and eurozone economies.

"There is an enormous degree of uncertainty surrounding the global economy and the eurozone economy," Trichet told a news conference after the bank held its key interest rates unchanged at 1.5 percent.

Earlier, the ECB cut its forecasts for eurozone growth this year and next year, but held its outlook steady for inflation in the 17 euro countries.

According to the bank's regular quarterly staff projections, area-wide gross domestic product growth (GDP) was expected to expand by 1.6 percent in 2011 and by 1.3 percent in 2012, down from 1.7 percent and 1.9 percent respectively in previous forecasts.

"A number of developments seem to be dampening the underlying momentum in the euro area," Trichet said.

These included "a moderation in the pace of global growth, related declines in equity prices and in business confidence, and unfavourable effects resulting from ongoing tensions in a number of euro area sovereign debt markets," he said.

© 2011 AFP

0 Comments To This Article