ECB’s Escrivá: Risks Around Baseline Scenario Could Push Projections Lower

21 May 2025

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member José Luis Escrivá said that risks around the ECB's baseline scenario could push macroeconomic projections lower.

In a panel discussion at the Foro Internacional Expansión in Madrid, Escrivá, who heads the Banco de España, said that in addition to the baseline scenario, the June projections would have ‘other more adverse simulated scenarios which now are subject to considerable uncertainty.’

‘The distribution of risks around the baseline scenario is to the downside’, he added.

If these risks were to materialise, which was not very likely, their impact would be significant and that could result in lower projections, according to Escrivá.

Regarding inflation, Escrivá noted short-term effects like the higher exchange rate or lower energy prices.

‘[The impact of] tariffs is harder to assess because that would depend on their size, the extent of retaliation and the possibility of second-round effects’, he said.

The ECB was now looking at a very complex environment, according to Escrivá, who said that it was likely that the June projections would include alternative scenarios.