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On December 30, 2021, a symphony of light, consisting of blue and yellow bars, lines and circles, the colors of the European Union, illuminates the southern facade of the European Central Bank (ECB) headquarters in Frankfurt, Germany. (Wolfgang Rattay / Reuters)
Frankfurt-Eurozone avoids this year’s recession and growth will accelerate significantly after bottoming out in the second quarter, a major European Central Bank survey said Monday.
According to the ECB’s financial analyst survey, the economy is currently expected to grow 0.1% in the second quarter and accelerate to 0.4% in both the third and fourth quarters.
The study, a key input in the ECB’s policy deliberations, predicted that the ECB would raise deposit rates by a total of 75 basis points this year, a total of 150 basis points by the end of next year, and interest rates peak at 1.25%. Mid 2024.
The survey presented to policy makers at the ECB meeting last week was put together before announcing that the ECB would rise 25 basis points in July and even more significantly in September.
Studies show that rate hikes will occur as the ECB fights to curb inflation. Inflation has returned to its 2% target by the first quarter of 2024.
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