The eurozone economy probably grew by no more than 0.4pc in the second quarter of the year, the European Commission said today. The Commission maintained its forecast for second quarter GDP growth of zero percent to 0.4pc and said the indicators point to continued slow growth in the third quarter.
"Most indicators used in the model for this horizon continue to suggest slow growth, although some recent confidence indicators have shown a slight improvement," the Commission said of its second quarter forecast. "For the third quarter of 2003, the model suggests growth in the same zero to 0.4pc range," it added. The forecast was published less than two hours before the European Central Bank announces its latest decision on interest rates. Having cut rates by 50 basis points last month, the bank is not expected to lower rates again today.
Analysts say it will wait until September, when it next hosts a post-policy meeting press conference, or until November, when Jean-Claude Trichet takes over as head of the bank, succeeding Wim Duisenberg. //www.fxcentre.com