2017.03.2308:56:00UTC+00ECB Says Eurozone Growth Momentum To Continue

Euro area economic recovery is steadily firming and the trend is likely to continue with growth firming and broadening going ahead, the European Central Bank said Thursday.

"The economic recovery in the euro area is steadily firming," the central bank said in its latest Economic Bulletin.

"Incoming data, notably survey results, have increased the Governing Council's confidence that the ongoing economic expansion will continue to firm and broaden."

Overall, surveys point to a robust growth momentum in the first quarter of 2017, the bank said.

The pass-through of the ECB's monetary policy measures is supporting domestic demand and facilitating the ongoing deleveraging process, the report added.

The bank also noted that economic growth in the euro area could be dampened by a sluggish pace of implementation of structural reforms and remaining balance sheet adjustment needs in a number of sectors.

The ECB Staff has projected 1.8 percent growth for this year and 1.7 percent for next. The pace of expansion is seen slowing further to 1.6 percent in 2019.

The risks surrounding the euro area growth outlook have become less pronounced, but remain tilted to the downside and relate predominantly to global factors, the bank reiterated.

The bank also repeated that there was "no signs yet of a convincing upward trend in underlying inflation". Measures of core inflation are expected to rise only gradually over the medium term.

Headline inflation is set to slow to 1.6 percent next year from 1.7 percent this year. But the figure was seen rising to 1.7 percent in 2019.

Regarding the global environment, the ECB noted that uncertainty remains elevated due to a number of factors including the design of the new US administration's policies and their effects on the US economy.

The gradual re-balancing of the Chinese economy and future relations between the United Kingdom and the European Union also pose risks to the growth outlook , the report said.