Reuters poll: ECB's recent policy moves only somewhat responsible for euro zone avoiding recession

• Reuters poll of economists expect eurozone economy has avoided a recession.
• No changes to policy any changes at Christine Lagarde's first ECB meeting.

The eurozone economy has avoided a recession, according to a Reuters poll of economists who were reasonably confident of that outcome, but their growth and inflation outlook remains very modest for the coming years.

Lead paragraphs

While the probability of a recession in the currency bloc over the coming two years held steady at 30% from last month, the various risks which have held back economic growth and inflation have not yet dissipated.

Still, the European Central Bank will in all likelihood do nothing when it meets to set policy on Dec. 12 and also stay on the sidelines for the next two years, the poll showed.

Sentiment around the euro zone economy has brightened somewhat over the past month. But stop-start headlines on the U.S.-China trade war and lingering uncertainty around Britain's exit from the European Union remains a threat to business activity.

Key notes

• With recent eurozone economic data beating low expectations, over 80% of economists polled by Reuters in the last week - 38 of 45 - said they were "reasonably confident" the eurozone economy had avoided recession.
• And while a majority of those 38 respondents said "some" of that confidence was due to the European Central Bank's recent policy easing, only two said "a lot" and the remaining nearly 30% said "none".

FX implications: 

Next week marks the first ECB monetary policy meeting with Christine Lagarde at the helm. However, no changes to policy any changes at this juncture although a bleak outlook for 2020 could be a weight on the euro going forward as markets begin to factor in eventually action from the ECB’.