The euro area is facing a “very difficult economic situation” that will test individuals and businesses, European Central Bank Vice President Luis de Guindos said.
The high inflation rates we are seeing across Europe coincide with an economic slowdown and low growth,” he told the Spanish Confederation of Young Entrepreneurs’ Associations in a December 16 interview published on the ECB’s website on Tuesday.
“It is very important that both individuals and companies take a prudent approach and focus on the long term.”
In his remarks, Guindos reiterated the messages he shared on the December 15 interest rate decision, including the new economic forecasts released that day. When asked how much borrowing costs will rise, he reiterated the ECB’s mantra that it would be decided “meeting by meeting and based on the data coming in”.
Guindos also underscored the view that the eurozone was going through a “short-lived and shallow recession” before the economy started growing again in the second quarter.
“This situation undoubtedly poses a challenge for businesses and their sustainability,” said the Vice President.
“With a looming recession, the current high level of uncertainty is making it difficult for companies and entrepreneurs to allocate their capital. So, with that in mind, it is very important to be careful.”
https://www.independent.ie/business/world/ecbs-guindos-sees-euro-economy-in-a-very-difficult-situation-42246565.html ECB’s Guindos sees the euro economy in a “very difficult situation”
