The European economy could not rehabilitate. The European Central Bank (ECB) decided to avoid a sharp termination of the support program after the appearance of the Omicron strain of coronavirus, which strengthens doubts in the restoration of Europe, transmits ABC.
Restoration of the economies of the eurozone countries slowed down against the background of problems with supply chains and a lack of raw materials. ECB confirmed that in 2022 he will stop the program to stimulate the purchase of pandemic bonds (bonds issued for helping poor countries in which infectious diseases are raging) in the amount of 1.85 trillion euros (2.1 trillion US dollars) in accordance with the schedule, but Translates part of purchases to another support program. He also stated that the assistance program can be resumed if necessary.
The actions of the regulator are aimed at reduced rates on long-term loans. This is done so that enterprises can survive the economic downturn during a pandemic. The head of Bank Christine Lagard stated that problems with deliveries impede the restoration of the economy, and the eurozone will not reach the dagedmamic level until the beginning of the next year. However, next year, growth should “accelerate strongly”, which will give the bank the opportunity to gradually stop pandemic purchases. “In general, society has become better to cope with the pandemic waves and restrictions. It could reduce the impact of coronavirus to the economy,” Lagard said and noticed that inflation would remain higher than the ECB expected.
It predicted the inclination of inflation for the next year to 3.2 percent, which exceeds the target rate of 2 percent and significantly higher than 1.7 percent, which was promised in September. Christine Lagarde said that the ECB expects stabilization of energy prices and electricity in the Eurozone in 2022, however, according to the head of the bank, the forecast is not accurate.
In early September, the ECB reduced the monetary stimulation of the economy: the monthly purchase of bonds was cut from 80 billion euros to 70 billion euros. On the decision to reduce the infusion of funds to the markets influenced including record inflation. Fully abandon the measures to support the economy adopted in Pandemic, the ECB plans in March 2022.