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Calviño trusts that the ECB gets rates right due to the risk of recession in the EU

Date: May 23, 2024 Time: 08:35:25

The acting first vice president, Nadia Calviño, trusts that the members of the Governing Council of the European Central Bank, who meet today in Frankfurt, will make the right decision on interest rates since the latest economic forecasts according to published. by the European Commission point to the risk of recession in some countries and the economic weakness that many others present. The reference rate in the Eurozone is currently at 4.25% after the nine consecutive increases in the price of money that the entity has been applying since July of last year to stop inflation.

Calviño believes that either there will be no upward movement or today’s increase will be “the last rise” (economists and managers suggest that, if it occurs, it would be an increase of 0.25 points). “I hope they get it right,” he said in an interview given this Thursday to TVE. In this context of weakness of the region’s economies, the ‘number two’ of the acting Government has highlighted the evolution of the Spanish economy, for which Brussels has this week raised its estimate of GDP this year by three tenths to 2 .2%, a forecast in line with that of the macroeconomic picture and that of organizations such as the Bank of Spain (+2.3%), the International Monetary Fund (+2.5%) or organizations such as the OECD (+2 ,1%) .

Calviño has highlighted the fact that Spain stands out in a context of such weak growth (the Eurozone will barely advance at 0.8%, according to the European Commission, due to the contraction of the German economy), although he has stressed that this scenario leaves no room for complacency. He highlighted how, despite the fact that Spanish inflation is among the lowest on the continent after standing at 2.6% in August, food prices continue to be “very high” and he gave the specific example of oil, a staple in the shopping basket for households.

He is not aware that distributors speculate with oil

“We are experiencing a few years of drought and poor harvests,” said Calviño, after recalling that there are forecasts that the oil harvest – of which Spain is the world’s leading producer – could fall by 50% this year. What happens in the countryside, he has influenced, affects the availability of oil on supermarket shelves. “We have lowered the applicable VAT precisely to try to alleviate this impact that we already saw was going to come and this is being directly reflected in the price,” he noted, recalling that this is evidenced by the analyzes of the National Commission of Taxes. Markets and Competition.

“The rains that are falling, not the Danas, are coming at a good time so that there will be a better than expected harvest for next year,” he added, and also recalled that in general terms (not in the particular case of oil ) Shopping basket prices are lower in Spain than in the rest of Europe, Calviño pointed out.

In his speech on public television he also stressed that the acting Executive is not aware that distributors are inflating the prices of liquid gold or that there is speculation with the price, and he recalled that if this were the case “it would be necessary to take action.” . measures “. Nadia Calviño has also pointed out that a price observatory has been launched and the CNMC has been instructed to be very attentive. In addition, she wanted to “appeal to the responsibility of the entire value chain.”

The National Institute of Statistics (INE) confirmed just a few days ago that the general inflation rate tightened in August to 2.6%. In the specific case of olive oil, the increase last month was 52.5% compared to August of the previous year, which represents its largest year-on-year increase in 21 years. The price of this basic product for households increased by an average of 8.7% compared to the previous month, July. Since March 2021, when it began to rise, until August of this year, the price of olive oil has increased by 114.8%.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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