Euro zone’s recovery fraught with risks, ECB’s Panetta says

© Reuters. Senior Deputy Governor of the Bank of Italy, Fabio Panetta is seen in his office ahead of his appointment to the European Central Bank’s executive committee

FRANKFURT (Reuters) – The euro zone economy has weathered its pandemic-induced crisis as well as possible but the long term recovery remains under threat, European Central Bank board member Fabio Panetta said on Wednesday.

A drop in global growth will continue to weigh on Europe, uncertainty is likely to hold back investment and consumption, and a tepid recovery could set off difficult-to-reverse recessionary forces, Panetta said.

“The euro area has so far weathered the consequences of the shock about as well as could be expected,” Panetta said in a speech. “Positive indications need to be taken with a pinch of salt, since the high levels of prevailing uncertainty make it difficult to rely on past regularities.”

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