29 August
ECB officials say euro's appreciation may hurt exports
At its June meeting, the European Central Bank (ECB) decided to cut interest rates again. According to the meeting minutes, policymakers warned that a stronger euro could pose risks for exporters.
As the ECB notes, trade uncertainty is already clouding the economic outlook for the 20-nation eurozone, with particularly negative effects on investment.
The single currency’s nearly 14% rise this year has helped curb inflation in the region. However, further euro appreciation could push consumer prices below the ECB’s 2% target and hurt the competitiveness of export-oriented companies.
According to the latest forecasts from the European regulator, inflation will slow to 1.6% in 2026 before returning to the 2% mark in 2027. Meanwhile, the bloc’s economy is expected to grow due to increased government spending in Germany.
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