MNI BRIEF: Eurozone To Grow, But Less Than Forecast-Official

Eurozone growth will be significantly below February’s European Commission forecast of 4% under the impact of surging energy prices and the Ukraine war, but base effects from 2021 mean it is still likely to avoid overall contraction during the year, a senior EU official said.

High inflation in member states remained supply-driven, though “somewhat more broad-based,” the source said, speaking ahead of Monday’s Eurogroup meeting of finance ministers, adding that officials are trying to consider scenarios which could differ substantially rather than using forecasts to guide decisions.

Turning to exchange rate developments, the official said current pricings “reflect monetary policy expectations in a fairly rational manner.”