Inflation in the EU may rise further but is likely to be under two per cent by early next year, EU Monetary Affairs Commissioner Mr Pedro Solbes was quoted as saying today.
Mr Solbes told Spanish newspaper
Expansion
in an interview."Although the Consumer Price Index (CPI) is performing badly and we cannot rule out that it will go up further, we expect the price of crude oil to fall in the second half of the year and inflation to fall under two per cent at the start of 2002,"
Mr Solbes also said EU finance ministers were against a weak euro due to its inflationary effects.
The EU official said he saw economic growth in the 12-member euro zone group of 2.5 per cent in 2001 - in line with forecasts from other European officials. The Irish economy is expected to grow by approximately 6.5 per cent this year.
"The euro zone forecast was down three decimal points from a previous forecast, because the US slowdown has affected us more than expected, especially in Germany," Mr Solbes added.