ECB's Panetta: Probability of recession is increasing

Eren Sengezer FXStreet

European Central Bank (ECB) executive board member Fabio Panetta said on Tuesday that they may have to adjust the monetary policy further, as reported by Reuters.

Panetta acknowledged that the probability of a recession in the eurozone was increasing and added that a recession would mitigate inflation pressures. "Real rates are not too far from the estimated neutral level," ECB policymaker noted and said recent econonomic developments should prompt prudence from the bank.

Market reaction

These comments don't seem to be having a noticeable impact on the shared currency's performance against its major rivals. As of writing, EUR/USD was trading at 0.9922, where it was down 0.2% on a daily basis.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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