-ECB officials: Reforms needed but risk of deflation eliminated
Markets that followed the European Central Bank (ECB) last week heard ECB officials emphasize the necessity for reforms in the Euro area and that the risk of deflation had faded.
ECB Executive Board Member Yves Mersch's, who focused on fiscal policies and structural reforms, spoke on the importance of strengthening macroeconomic stability in the region.
"All euro area countries first and foremost need to increase their resilience. Strengthening macroeconomic resilience is particularly important in the euro area," he said.
On the other hand, speaking at an event organized by the ECB's Brussels Representative, Peter Praet noted the uncertainty over the inflation outlook in the Euro area declined significantly and the risk of deflation had vanished.
“Concerning the second criterion, confidence, uncertainty about the inflation outlook has been declining significantly and the risk of deflation has vanished,” he said, adding that inflation expectations have been gradually improving and are increasingly consistent with the Governing Council’s inflation aim.
The European Central Bank will meet in Frankfurt on July 26. After the announcement of interest rate decisions at the meeting, a press conference will be held.
-The week ahead
This week in the Euro area, markets will focus on the speeches of European Central Bank (ECB) President Mario Draghi in Brussels.
In addition, other ECB officials' speeches both in Frankfurt and elsewhere should give some hints as to how interest rates will be addressed at the upcoming meeting in Frankfurt.