European Central Bank President Christine Lagarde saidBaccaratfreegameThe decline that led to the near stagnation of the European economy for more than a year is coming to an end.
Ms Lagarde told the Council on Foreign Relations in Washington on Wednesday that output from the 20 eurozone countries was "recovering and we are clearly seeing signs of recovery".
"We don't have a recession, but growth is very slow and very small," she said. But "the employment and job markets are excellent."
The ECB will almost certainly cut interest rates at its next meeting in June to provide some support for growth, but what will happen after that is increasingly uncertain.
This is partly because Fed chairman Jerome Powell hinted on Tuesday that officials would wait longer than expected to cut interest rates after a series of unexpectedly high inflation data.
Tensions in the Middle East are also a risk factor.
"We are trying to analyze the consequences," Lagarde said. "an obvious example is the impact on commodity prices and how oil and gas prices, which have been crucial for the past three years, will respond to current shocks."
Traders think it is almost certain that the ECB will cut interest rates by 25 basis points for the first time in June, and the market expects to cut interest rates by 80 basis points for the whole of 2024, equivalent to three 25 basis point cuts, with a 20% chance of a fourth.