Top European central bankers said interest rates in the eurozone are at the right level for now and expressed confidence the region's economy will rebound next year.
"There are good chances that the euro area will strengthen in 2003," the European Central Bank's chief economist, Otmar Issing, told Wall Street economists, adding that he expects a rise in domestic demand to bolster growth in a region that has relied heavily on exports to keep the economy afloat.
The ECB vice-president, Lucas Papademos, also said the bank expects the eurozone to grow about 2.5 per cent next year, an improvement from its current performance of roughly 0.4 per cent, with inflation moderating.
Their optimism came despite a report showing the hesitant recovery in eurozone manufacturing went into reverse in September as new orders fell and businesses curbed production and accelerated job cuts.
The fall in the Reuters eurozone purchasing managers' index to 48.9 from 50.8 in August fuelled speculation that the ECB may be forced to cut rates to prevent a recession.
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