ECB: “The recovery is proceeding, but risks remain. Well the work” – The Republic

MILAN – The recovery is proceeding at a moderate pace, and the risks are still to the downside. However, continuing improvements in the labor market. And ‘what he writes in summary, the European Central Bank in its monthly bulletin on the health of the economy. Mario Draghi, however, continues to monitor the situation stressing that the ECB “is ready to act with all available means.”

Resume. The ECB emphasizes that the economy is sustained economic recovery in the euro area is continuing, supported by domestic demand, while export growth remains modest. Looking ahead, the economic recovery “should proceed at a moderate pace”, but “the risks to the outlook for euro area growth remain on the downside.” The Eurotower “expects the economic recovery to continue at a moderate pace, despite the increased uncertainty following the outcome of the referendum in the UK. Domestic demand continues to be supported by measures of monetary policy of the ECB”. In addition, “the steady increase in employment and the price still relatively low oil should continue to support real disposable income of households and private consumption. However, the intensification of uncertainties following the referendum in the UK could affect the climate of confidence and trade. the recovery in the euro must also overcome the challenges posed by other geopolitical uncertainties. at the same time, the economic recovery is still hindered by budgetary adjustments in progress in several areas, from the slow implementation of structural reforms and the prospects for growth contained in emerging countries. In this context, the risks on the outlook for euro area growth remain on the downside. “

Work. ” the labor markets in the euro – still writes the ECB – continue to improve gradually. ” In the first quarter of 2016, says the report, employment increased by a further 0.3 percent on quarter. Overall, employment was higher by 1.4 percent from a year earlier, the largest annual increase observed since the first quarter of 2008. Also in May, the unemployment rate in the euro area continued its decline, falling to 10.1 per cent. The long-term unemployment (the percentage of the population unemployed for at least 12 months) continues to slowly decrease, but is over 5 per cent of the workforce. In recent months, the most recent survey data continue to improve and foreshadow further increases in employment in the near future.

Inflation. The dynamics of prices should remain at “modest levels “in the coming months and then recovered in 2017 and 2018. Looking ahead, explains the institute in Frankfurt,” on the basis of current futures prices for energy, the inflation rate will remain at low levels or maybe even slightly negative in coming months before recovering later in 2016, mainly reflecting base effects. Thereafter, inflation is expected to increase again in 2017 and 2018, supported by monetary policy measures the ECB and expectation of economic recovery. ” The result of the referendum in the UK on Brexit, yet highlights the ECB “has increased the level of uncertainty about the inflation outlook.”

Banks. In the monthly bulletin of the Central Bank states that “banks have provided favorable conditions of financing for customers through more content and better credit conditions in lending rates promote the resumption of loan growth.” In fact, underlines the ECB, “the bank lending survey in the euro area for the second quarter of 2016 showed further improvement of the offer conditions of loans to businesses and households and the continuing increase in demand for all categories of loans. ” Therefore, according to the institute in Frankfurt, “the light of the current uncertainty, it is essential that the channel of bank loans continue to function properly.”

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