The European Central Bank researchers (ECB) stated in a report on Wednesday that it is unlikely that the European economy will witness a scenario of stagflation similar to that of the seventies.
Highlights
“Although growth forecasts were cut and price expectations were raised following the Russian invasion of Ukraine, it is still considered that economic activity will increase next year and that inflation will slow below 2% in the second half of 2023“.
“Current forecasts by experts are still far from a stagflation scenario.”
“However, uncertainty has increased, leading to a wider range of estimated results.”
“Some differences between the current situation and that of the 1970s make it less likely that stagflation will develop now.
Source: Fx Street
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