Inflation pressures are easing as the euro zone economy slows significantly according the the ECB. The editorial of its February bulletin is a close repeat of the statement read out by ECB President Trichet last week. The ECB says “The latest economic data and survey information confirm that the euro area and its major trading partners are undergoing an extended period of significant economic downturn, and that accordingly both external and domestic inflationary pressures are diminishing.”
According to the bank, the level of uncertainty remains exceptionally high and quarter on quarter growth in the fourth quarter of 2008 was likely to have been “very negative.”
