European Central Bank officials say economy remains weak

Frankfurt, Jan 16 (AP) Top officials at the European Central Bank say economic growth remains weak though they see a few upbeat signs after the US and China moved toward lowering trade tensions. Recent data point to “a stabilization in euro area growth,” according to an account of the December 12 policy meeting released on Thursday.

It was the first policy meeting under new ECB head Christine Lagarde, who succeeded Mario Draghi on November 1. But members of the 25-person governing council still see “continued weak euro area growth dynamics.”

The big concerns remain developments outside the 19 countries that use the euro. The eurozone depends heavily on trade and manufacturers in the region have been hard hit by uncertainty over the outcome of U.S.-China trade negotiations. The possibility of new tariffs, or import taxes, has cast a shadow over investment plans and the fate of the intertwined supply chains in the global economy.

The US and China signed a deal resolving some issues on Wednesday but global tensions over trade remain largely unresolved. The ECB foresees modest growth of 1.1 per cent for the eurozone this year. Service companies and construction activities have helped support growth while manufacturing of goods such as autos and industrial machinery remains in a recession. (AP) ZH

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