European Economic Affairs Commissioner Paolo Gentiloni said in an interview with the Italian newspaper Il Sole 24 Ore on Tuesday, he expects Eurozone GDP contraction around the start of this year may be less deep than was expected in November.

“The 0.3% forecast still seemed quite solid but various factors suggested the contraction expected in the fourth quarter of 2022 and the first quarter of this year would not be so sharp as had been expected,” Gentiloni noted.

Market reaction

At the time of writing, EUR/USD is trading at 1.0730, modestly flat on the day.