ECB’s de Guindos: Even in Most Severe Scenario, Europe Not Going into Recession
16 March 2022
By David Barwick – FRANKFURT (Econostream) – European Central Bank Vice President Luis de Guindos said late Tuesday that the Russian attack on Ukraine would not drive Europe into recession even in the worst-case scenario of the ECB.
In an interview with Spain’ Antena 3 television, de Guindos said, ‘Logically, the invasion of Ukraine and the subsequent war is very bad news from an economic point of view ... and it will mean that inflation, which was already high, will be even higher, and economic growth will be affected. But we are not going into recession, even in the most severe scenarios that we have, the European economy is not going into recession.’
The ECB, he noted, ‘decoupled in a way’ the lift-off of interest rates from the end of asset purchases, and indicated after last week’s Governing Council meeting that upcoming decisions depended on inflation data.
‘But what I would basically say, we are in a process of normalisation of monetary policy from the point of view of purchases, but that does not at all imply that we are going to raise interest rates immediately’, he added.