MNI BRIEF: Eurozone Risks Mediocre Growth-Bank Of Greece No. 2

There is a risk gradually tightening monetary policy could stifle eurozone growth just as energy shocks become more frequent due to the green transition, Bank of Greece Deputy Governor Theodore Pelagidis told MNI.

“The biggest threat for the eurozone economy is that mediocre growth returns as monetary policy becomes gradually and cautiously less accommodative. Indeed, in an environment of possible, periodic energy-driven, ‘green inflation’ shocks,” Pelagidis said in an emailed comment.

The European Central Bank moved towards tighter policy in December, deciding to end its net pandemic purchases in March, together with boosting its separate Asset Purchase Programme to EUR40 billion a month in the second quarter.