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Economic activity in the eurozone has slowed compared to 2022, but will be "much better" this year than initially feared despite inflation and the energy crisis.

This was announced today by the president of the European Central Bank (ECB), Christine Lagarde

Christine Lagarde - French lawyer and politician.

Born on January 1 in Paris.

Next in the US and France.

From 1981, quoted by France Press.

"The news has been much more positive in recent weeks, which means that the current year will not be brilliant, but it will be a lot better than we feared," she told the Davos economic forum.

Labor markets, especially in Europe, "have never been so dynamic" and the number of unemployed "was at its lowest level in the last 20 years", Lagarde stressed.

This is mostly about Germany, the leading European economy, which is expected to avoid recession in 2023 despite the still tense situation due to the energy crisis, as Chancellor Olaf Scholz stated in his interview with Bloomberg yesterday.

Battered by inflation driving up production costs in the industrial sector that drives its economy, Germany appears to be holding up better than expected thanks to strong consumption and substantial government aid.

Industrial production in the EU and the euro area with 2% growth in November 2022.

The European Commission, for its part, foresees a contraction in the gross domestic product of the euro area as well as of the EU in the last quarter of 2022 and the first three months of 2023, before recovering in the rest of the year.  

Lagarde, meanwhile, highlighted the inflation data, which remains "quite high" even though price increases have slowed since a peak of 10 percent in October. 

"We are determined as a central bank to reduce inflation to 2 percent in a timely manner, taking all measures to achieve this goal," she emphasized. 

The ECB has raised interest rates by 2.5 percentage points since July, an increase with unprecedented speed, and plans to maintain this restrictive ceiling in the coming months in an effort to reduce inflation sustainably, BTA noted.

Christine Lagarde

European Central Bank

ECB

the euro area