Draghi says outlook in the euro area are more “brilliant” – TVI24

The President of the ECB, Mario Draghi, believes that “the economic outlook for the euro area are now brighter than they have been over seven long years.”

The leader of the European Central Bank (ECB) conluiu thus on a positive note his speech on the second day of the Governing Forum to be held in Sintra for the second consecutive year, justifying this optimism with the data of economic growth and with inflation expectations.

But Draghi also left a warning: “This is by no means the end of our challenges and the cyclical recovery alone will not solve all Europe’s problems. It does not eliminate the debt burden that affects parts of the Union. It does not eliminate the high levels of structural unemployment that haunt many countries. And that does not eliminate the need to improve the institutional structure of our monetary union. “

Mario Draghi also called on governments to engage more systematically with structural reforms” that anchor the resumption of growth. “

This is because, although” monetary policy can steer the economy back to its potential and structural reforms can “raise this potential”, will be the combination of these policies will allow a “stability lasting and prosperity “in the eurozone.

Despite the upbeat tone that ended his speech, Draghi gave a speech marked by the need for structural reforms and even left the warning that given the current forecasts put the growth potential in the euro area below 1% of the losses resulting from the current crisis could become permanent and high unemployment.

“The potential growth is now estimated at less than 1% in the eurozone and is expected to remain well below the growth rates before the crisis. This would mean that a part significant economic losses due to the crisis would become permanent, with structural unemployment is above 10% and the high youth unemployment, “said the head of the ECB.

The second world forum ECB began on Thursday and runs until Saturday, joining again in Sintra some of the most influential personalities of the world of monetary policy to discuss unemployment and low inflation in Europe.

During the conference you can still hear the governors of the central banks of England, Mark Carney, Ireland, Patrick Honohan, and Japan, Haruhiko Kuroda.

At the Forum will be present also the chief economists of the major international economic organizations: Peter Praet, the ECB, Olivier Blanchard (who leaves office in September), the International Monetary Fund (IMF), and Catherine L. Mann, the Organization for Economic Cooperation and Development (OECD).

The Global Forum takes place at a time when the inflation rate in the euro area seems to have left the negative territory: in April the latest data point to an annual inflation rate in the euro area in 0.0% , compared with -0.1% in March.

The ECB conference replicates a model that the Federal Reserve (Fed) US held since 1978 in Kansas City, Jackson Hole, who named the event that the Fed promotes annually. Last year, the ECB held its first global conference in Sintra.