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ECB 2023/24 inflation forecasts subject to downside not just upside risks -Visco -Breaking

by Mike Robinson

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© Reuters. FILE PHOTO : Ignazio Visco, member of European Central Bank Governing council, watches as he answers questions from Reuters during an interview in Rome (Italy), May 31, 2021. REUTERS/Guglielmo Mangiapane

MILAN, (Reuters) – The European Central Bank’s projections that the inflation rate will fall below 2% within the eurozone in 2023 and 2024 is not only upside risk but also downside. Ignazio Visco, a member of the ECB Governing Council said this in an interview on Thursday.

This month, the ECB raised inflation projections above its 2% target in this year and 2022. It also forecast that inflation will be lower in the next two years.

Several policymakers questioned ECB projections at December’s policy meeting. They argued that the bank underestimates the risks of price growth above the 2% target.

Visco told La Stampa that the (inflation forecasts below 2.2% for 2023-24 can be subject to both upside and downside risks.

Visco indicated that Omicron the coronavirus variant Omicron has yet to have an impact on the Euro zone economy.

Concerning the European Union Stability Pact Visco stated that sustainability in fiscal budgets is crucial in all member states. He also suggested it would be beneficial to have an EU minister or euro zone.

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