Access Investments-European Union- ROMANIA

Back in June 2013 on a state visit to Japan, French President Francous Hollande declared the Eurozone crisis was "over".  How could the ECB claim that recovery has not been achieved, when according to Hollande, the Eurozone has been out of recession for nearly two years?  The central bank’s estimates have been considered optimistic by external observers, as private forecasters remain more sanguine about the euro area’s prospects. Members of the ECB Board  warned that growth projections for 2017 relied on several elements which might turn out to be less supportive than the forecasts assumed.   Peter Praet, the ECB’s chief economist, said that the governing council had to remain cautious “given the very early stages of the economic recovery and the high degree of uncertainty,” particular when dealing with forecasts running up to 2017.

Members of the council “generally shared” the view that the forecasts represented an accurate assessment of the situation. The central bank has pencilled in growth of 1.5pc for this year, 0.2 percentage points higher than the consensus. It expects growth of 1.9pc and 2.1pc in the following two years.   Christian Schulz, an economist at Berenberg, said that “there are plenty of the risks” that both growth and inflation might be lower than projected. “The word risk appears 16 times in the minutes,” he said.   The minutes stated that the upward revisions to growth should not be taken to mean that the €1.1 trillion (£810bn) package of asset purchases “was less necessary”. The QE scheme has already been effective in reducing borrowing costs and weakening the euro. ECB purchases began last month, as the euro area entered a fourth straight month in deflationary territory.   The higher growth and inflation forecasts “confirmed that full implementation of these measures was required to deliver on the governing council’s mandate”, the minutes said. Members believed that this provided grounds for “prudent optimism” regarding a gradual recovery and returning inflation to its close to 2pc target. The minutes showed that the committee intended to continue the purchases “without hesitation” until its objectives are met. Jonathan Loynes, chief European economist at Capital Economics, said: “