BRUSSELS (MktNews) - The European Central Bank (ECB) upbeat outlook for robust eurozone growth after 2002 assumes continuing strong investment and employment growth, a European central banking source said Tuesday.
ECB President Wim Duisenberg said Monday the central bank's internal forecast for eurozone growth of "nearly 3% for this year and next" could be extended to the following year as well.
This is because forecasts for 2002 already provide the basis for the following year, the source explained. Moreover, high eurozone capacity utilization levels argue for further solid investment growth.
The further decline in eurozone unemployment, which Duisenberg predicted could fall below 8% by 2003, will make an additional contribution to growth, the source said.
In general progressively tightening labor markets are not expected to pose a problem, except perhaps in France, the sources said.
Over half of French industry firms now report hiring difficulties according to regular sector surveys. The share is even higher in construction. The Bank of France has repeatedly argueds for flexible regulation of overtime hours, in order to ease bottlenecks to expanding production and so reduce inflation risks.