Europe Central Bank lowers Europe GDP growth forecast for 2022, 2023

By Al Mayadeen Net
Source: Agencies
10 Mar 2022 18:36

The European Central Bank has lowered its expectations for GDP growth amid the Ukraine crisis, citing the Ukraine crisis as the cause behind the drop in projections.

European Central Bank President Christine Lagarde

The European Central Bank downgraded its eurozone GDP growth forecast to 3.7% for 2022 and 2.8% for 2023, ECB President Christine Lagarde said Thursday.

"In the baseline of the new staff projections, which incorporate a first assessment of the implications of the war, GDP growth has been revised downwards for the near term," Lagarde said, citing the Ukraine crisis as the reason behind the lowering of expectations.

The projections foresee the economy growing at 3.7% in 2022, 2.8% in 2023, according to the European official, while projections for 2024 are at the low of 1.6%.

In December, the European Central Bank had lowered the eurozone's GDP projection for 2022 to 4.2% and hiked the projection for 2023 to 2.9%.

"Our Eurosystem [and ECB] staff projections for the annual real GDP growth at 5,1% in 2021, 4,2% in 2022, 2,9% in 2023 and 1,6% in 2024, compared with our September staff projection the outlook has been revised down for 2022 and up for 2023," Lagarde said at the time.

As for inflation, the baseline in the new staff projections has been revised upwards, Lagarde revealed, "With an annual inflation at 5.1% in 2022, 2.1% in 2023 and 1.9% in 2024."

Inflation in the Eurozone hit a new record high in the latest estimate in December, as data showed on Friday that the headline inflation rate was at 5% for the month compared to the same time last year.