ECB's Schnabel Says Euro Area Faces Weak Near-Term Outlook.

The Euro-area economy is facing a weak near-term outlook, according to European Central Bank Executive Board member Isabel Schnabel. While sentiment indicators may be bottoming out, the economic outlook remains weak, and financial conditions have loosened more than projected. The ECB has kept interest rates on hold as it assesses the impact of its tightening campaign on the economy. Inflation has slowed, but underlying price pressures remain elevated. Schnabel also mentioned that crucial indicators for the outlook of underlying inflation are the developments of wages, profits, and productivity. The drop in unemployment confirms strong resilience in labor markets, and the new fiscal rules are seen as a step in the right direction, although they lack a central fiscal capacity. [Extracted from the article]