MILAN (Reuters) – – The European Central Bank’s forecasts for it is likely that inflation levels in the Euro area will be less than 2 percent by 2023 and 2024 is subject to downside risks and not only upside dangers, ECB Governing Council member Ignazio Visco said in an interview that was published on Thursday.
The ECB this month increased its inflation projections by more than its target of 2% for this year and 2022. The forecasted inflation will remain below the target for the next two years.
However, at the December meeting of the bank’s policy committee, many policymakers raised doubts about the projections of the ECB, saying that the bank has underestimated the likelihood of price increases above the target of 2.
“The (inflation) projections of a lower 2percent in 2023-24 are, of course, susceptible to the downside as well as upside risks,” Visco, who is also the director of the Bank of Italy, told the Italian daily La Stampa.
Visco stated that the ultimate impact on the eurozone business of the variant of coronavirus Omicron that has spread beyond control in Europe is not known currently.
Concerning the European Union Stability Pact, Visco stated that sustainable fiscal budgets were essential within the EU and in every member state. He also said it is beneficial to have a eurozone and an EU economic minister.
(Reporting from Sara Rossi, editing by Gianluca Semeraro; editing done by John Stonestreet and Susan Fenton)
