Source: European Central Bank
Economic activity in the Euro area could return to pre-COVID levels in the first quarter of 2022, but erasing the damages could take longer.
- The economy is predicted to post strong growth in the third quarter after the rebound in the second quarter.
- Optimism is driven by the vaccination rollout and the easing of lockdown restrictions in most Euro area countries.
- Manufacturing is poised to report strong growth even with supply issues, services will bounce back due as economies reopen.
- The ECB warned that there may be a “long way to go” before the damage to the economy caused by COVID-19 is offset.
- A decline was reported in the number of individuals in job retention schemes, but still remains high.
- Employment remains 3.3 million people less than the levels seen before the pandemic, especially among the youth and lower-skilled.
- The ECB believes policy support remains essential, and an “ambitious” and coordinated fiscal policy should complement monetary policy.
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