The ECB, as the single monetary authority in the euro area, hereby plays its part by focusing on its primary objective of maintaining price stability over the medium term. Let me now give a brief overview of how we perceive developments in Latin America. The overall outlook continues to improve, although uncertainties as to the strength and resilience of the growth recovery remain.
The region’s output is bottoming out as South America’s recession is being partially offset by a better situation in Mexico and Central America. The region’s recovery has been helped by higher than expected growth in Brazil in the first two quarters of 1999, while inflation remained subdued. Most observers expect inflation to be some 10% in 1999, the lowest level in 50 years.