ECB Economic Bulletin September 2020

Economic and monetary developments

Key Points:

At its monetary policy meeting on 10 September 2020, the Governing Council decided to keep its accommodative monetary policy stance unchanged.
The coronavirus pandemic remains the main source of uncertainty for the global economy
Although financial conditions in the euro area have loosened somewhat further since the Governing Council’s meeting in June 2020, they have not yet returned to the levels seen before the coronavirus pandemic.
Euro area real GDP contracted by 11.8%, quarter on quarter, in the second quarter of 2020
This assessment is broadly reflected in the September 2020 ECB staff macroeconomic projections for the euro area.
According to Eurostat’s flash estimate, euro area annual HICP inflation decreased to ‑0.2% in August, from 0.4% in July
This assessment is broadly reflected in the September 2020 ECB staff macroeconomic projections for the euro area, which foresee annual inflation at 0.3% in 2020, 1.0% in 2021 and 1.3% in 2022.
The coronavirus pandemic has continued to influence significantly monetary dynamics in the euro area.
The coronavirus pandemic continues to have an extraordinarily large impact on public finances in the euro area.