RTTNews - Thursday, European Central Bank Vice President Lucas Papademos said despite a sharp downturn in the first quarter, the Eurozone economy is expected to kick-start recovery sooner than anticipated.

Speaking at the 37th Economics Conference organized by the Österreichische Nationalbank in Vienna, Papademos said, Recently, we have observed an increasing number of positive signs suggesting that the economy is stabilizing and that the recovery may start sooner than previously envisaged, despite the further strong deterioration of economic activity in the first quarter of this year.

However, the available economic data and survey indicators point to a stabilization at very low levels and economic activity in the euro area is likely to gradually recover in the course of 2010, he added.

The central banker noted that the monetary policy stance and the non-standard measures taken so far will ensure the preservation of price stability over the medium term. He asserted that these measures will progressively provide further support to economic activity.

Last week, the ECB had reduced its key interest rate to a new low of 1% and announced a plan to buy EUR 60 billion covered bonds, joining the Federal Reserve and other central banks in buying debt under their quantitative easing policies.

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