© Reuters. FILE PHOTO: The euro sign is photographed in front of the former headquarters of the European Central Bank in Frankfurt, Germany, April 9, 2019. Picture is taken on slow shutter speed while the camera was moved. REUTERS/Kai Pfaffenbach/File Photo
LONDON (Reuters) – S&P Global (NYSE:) said on Thursday it has lifted both its euro area economic growth and inflation forecasts for this year, but expected to inflation to fall back below its 2% target next year.
The ratings agency said that Europe’s economic recovery since lockdown restrictions were lifted in March-April had been “surprisingly strong,” leading it to raise its growth forecasts to 5.1% for the current year, from 4.4% previously.
In a note, S&P Global said it had also revised up its inflation forecast for this year to 2.2% from 1.8%.
“However, we continue to see inflation decelerating below the ECB’s target next year on the back of subdued wage development and falling growth momentum,” S&P said, referring to the European Central Bank’s 2% inflation target.
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