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The war in Ukraine could dampen the pace of the recovery in the eurozone, while inflation is likely to be close to 4% for the year.
The European Central Bank will have more trouble navigating through the storm, though we still expect an end to quantitative easing in the third quarter and a first rate hike towards the end of the year.
Downward pressure on growth and upward pressure on inflation hasn’t made the ECB’s life any easier.