Looking ahead, our earlier expectations that the euro area economy would expand at a moderate rate this year and next have been confirmed. The latest projections by Eurosystem staff are broadly in line with this assessment. In our view, the risks to this outlook are broadly balanced.
Nevertheless, the recovery is likely to remain uneven over time and across economies and sectors, in an environment of continued uncertainty and with tensions in some segments of the financial markets. The annual rate of inflation in the euro area stood at 1.6% in May, up slightly from 1.5% in April, mostly because of higher energy prices.