‘Uncertainty’ warning from the European Central Bank
European Central Bank (ECB) President Christine Lagarde said the Eurozone economic outlook is full of uncertainties stemming from supply bottlenecks, rising energy prices and the new wave of epidemics.
Successful vaccination campaigns are key to economic recovery
Lagarde stated that the economic recovery was due to the rapid and successful vaccination campaigns and said that the vaccination rate in the population over the age of 12 in Europe exceeded 70 percent.
Stating that the restrictions applied due to the epidemic in the Euro Zone have almost completely disappeared, Lagarde explained that only practices such as social distance and mask use continue.
Pointing out that the manufacturing and service sectors gained momentum with the opening, Lagarde said that product sales also increased.
Emphasizing that the “uncertainties” that threaten growth still continue, Lagarde stated that there have been supply bottlenecks and interruptions in the supply chain for several months, but supply bottlenecks are on their “radar”.
The reason for the increase in energy prices is the increase in natural gas and oil prices.
Reminding that the Euro Zone is in an energy-importing position, Lagarde explained that the increase in energy prices was due to natural gas, electricity and oil.
Recalling that the prices of energy products dropped significantly last year, Lagarde emphasized that the recent increase in energy prices was due to the “base” effect.
Expressing that they expect energy prices to fall in the first part of 2022, Lagarde said that another source of uncertainty is the repetition of measures and shutdowns with the new epidemic wave.
Lagarde stated that the increase in inflation was due to the reopening of economies and the base effect.
