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Economic Bulletin Issue 6, 2021
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The impact of supply bottlenecks on trade
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Economic Bulletin
Summary
While the recovery in global demand and the sizeable fiscal stimulus are supporting global and euro area activity, the near-term economic outlook remains clouded by uncertainty about the resurgence of the pandemic and the roll-out of vaccination campaigns. Persistently high rates of coronavirus (COVID-19) infection and the associated extension and tightening of containment measures continue to constrain economic activity in the short term. Looking ahead, progress with vaccination campaigns and the envisaged gradual relaxation of containment measures reinforce the expectation of a firm rebound in economic activity in the course of 2021. Inflation has picked up over recent months on account of some idiosyncratic and temporary factors and an increase in energy price inflation. At the same time, underlying price pressures remain subdued in the context of significant economic slack and still weak demand.
Date
Understanding post-referendum weakness in UK import demand and UK balance of payments risks for the euro area 0 / 0 x
Prepared by Valerie Jarvis and Tobias Schuler
1 Introduction
The UK referendum on EU membership in 2016 has set the course for the most significant change to the relationship between the United Kingdom and its closest trading partners for decades. The primary interest from the ECB’s perspective is to understand the likely impact on trade of the departure of the United Kingdom from the European Union, as the United Kingdom has long been one of the euro area’s major export markets.
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