Lagarde admits that the economic impact of the coronavirus is "a source of concern" - La Provincia


The president of the European Central Bank (ECB),Christine Lagarde, he reiterated this Thursday in the European Parliament that there are "signs of recovery" of the eurozone economy, although he has also acknowledged that "uncertainty" about the possiblecoronavirus impact represents anew "source of concern".

During his appearance before the Eurocamara Economic and Monetary Affairs Committee, Lagarde said that some advanced indicators are now "slightly more optimistic." He also stressed, on the positive level, thatcommercial tensionsbetweenChina and the United StatesAre decreasing. "However, other risks are persisting or, such as uncertainty about the impact of the coronavirus, are a source of renewed concern," said the president of the issuing institute.

Lagarde has pointed out that the impact that the coronavirus outbreak will have on the Chinese economy and globally is still very "uncertain.""We have to be cautious, attentive and patient", has recommended the French, who recalled that these pandemines "have a tendency to affect and, once contained, the economy grows again."

"It's what clearly happened with the SARS a few years ago", he noted, in reference to the outbreak of acute and severe respiratory syndrome in 2003 also in China.

"High" Uncertainties

In general, Lagarde has stressed that the economy of the euro zone continues to grow, although with a "still modest" momentum, in line with the ECB's expectations. The domestic economy, in particular, remains "relatively solid", with private consumption expanding 0.5% in the third quarter of last year.

"Even so, global factors continue to weigh on the growth of the eurozone," the ECB president lamented before MEPs, who also recalled that some of theuncertaintiessurrounding the global economic environment remain "high."

This moderate growth of the economy, explained Lagarde,is "delaying" that the rise in wagesit is translating into higher prices, and that is why inflation remains "weak": around 1.4% in January. According to Lagarde, the downward trend of growth, thelower productivity and agingof the population are the main causes of the fall in interest rates, which together with low inflation have reduced the ability of the ECB and other central banks to relax their monetary policy.

In addition, other "structural" challenges such as threats to environmental sustainability, "rapid" digitalization, globalization and "changing" financial structures "have also affected price developments."

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