In order to assess the underlying momentum of euro area economic activity and to avoid being misguided by highly volatile quarterly outturns, it is necessary to look through the volatility in quarter-on-quarter growth rates and monthly indicators. Taking this perspective, growth in the world economy, while moderating, is expected to remain relatively resilient, benefiting in particular from sustained growth in emerging economies.
Now, it has come down to just above 6 percent. Clearly this is still way too high. But I do believe that, in the absence of further supply shocks, the worst is behind us in terms of the immediate assault on our citizens’ purchasing power. However, a strong word of caution is still in order.