Euro Zone Better off than the US: ECB's Liebscher
Euro zone growth could come in below 2 percent this year, European Central Bank Governing Council member Klaus Liebscher was quoted as saying on Thursday, but the region is better off than the United States.
Liebscher told Austria's Salzburger Nachrichten that the euro zone economy could expand at just below its potential rate, in line with comments by several other policymakers.
"Our (ECB staff) projections for euro area growth have been 1.5-2.5 percent or an average 2.0 pct for this year," he said. "It may be one or two tenths (of a percentage point) less than that. All of this does not mean we are in a bad situation."
The ECB kept interest rates steady at 4 percent at its last meeting but other major central banks have cut rates, including a surprise 75 basis point cut from the U.S. Federal Reserve.
Liebscher declined to comment on the Fed cut, which has increased speculation the ECB will have to follow suit.
"It is clear that the difficulties in the U.S. economy will have a dampening effect, whether there will be a recession or not is difficult to say," Liebscher said.
"I expect after a period of dampened growth in the second half we will see a recovery in the United States."
"The euro zone is doubtless in a better, more secure position. However, there are some downward risks."