In the Governing Council’s view, the risks to this favourable medium-term outlook for growth are broadly balanced over the shorter term, while the balance of risks remain on the downside at medium to longer horizons. These relate mainly to external factors, notably potential protectionist pressures, possible further oil price rises, global imbalances and potential shifts in financial market sentiment.
Regarding employment conditions, although the decrease in the number of employees and in wages is slowing, efforts by firms to reduce personnel expenses have prolonged the severity of households’ income conditions. As for the outlook, public investment is likely to increase for some time.