FRANKFURT: The European Central Bank on Thursday cut its forecast for eurozone growth next year, but raised its projection for inflation in the 17 countries that share the euro.
ECB President Mario Draghi said the bank was expecting eurozone gross domestic product growth (GDP) to contract marginally by 0.1 percent this year, compared with its previous forecast of growth of 0.3 percent.
The bank also cut its forecast for 2013, when growth was set to pick-up to a moderate 1.1 percent, instead of 1.3 percent as originally predicted.
At the same time, area-wide inflation was to reach 2.4 percent in 2012, way above the ECB's target of close to but just below 2.0 percent. Previously, the bank had been forecasting annual inflation rate of 2.0 percent for the current year.
Inflation would slow to 1.6 percent in 2013, the bank predicted.
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