MNI BRIEF: Eurozone Heads For Soft Landing, Official Says

The eurozone is heading for what looks like a soft landing after weak Q3 activity data coincided with signs of a still-robust labour market, an EU official said ahead of Wednesday’s Eurogroup meeting of finance ministers, adding there was “no reason to expect a protracted contraction.”

“The slowdown was needed and expected in order to bear down on inflation,” the official said. “The general expectation is that this is going to be as close to a soft landing as one can hope for after the series of shocks we have suffered over the last couple of years.”

Member states agree fiscal policy has to be managed in a way which would restore price stability, the official said, adding that “The exact calibration of what that means for fiscal and monetary policy - there are different views and those will evolve as we get more information.”

The Commission is likely to give ministers some idea of its thinking on states’ Draft Budgetary Plans for 2024 ahead of the publication of its assessment of these due on Nov 21, the official said. (See MNI: Hopes Rise In Dash For EU Fiscal Rule Deal By Year End)