May 16. Jean-Claude Trichet cautioned Thursday about a looming economic slowdown in the Eurozone, although GDP growth data remain stable and point to the opposite. According to Eurostat, GDP in the Eurozone turned out to be higher than expected based on revised data, largely thanks to unexpectedly strong GDP growth in Germany and France. However, Trichet told analysts and the investment community that they should not take these data too seriously and added that ECB expects the situation to deteriorate from the current level. He said that significant flexibility of the economy was proven in their report, although, ECB expects growth to subside to some extent further down the road. After this announcement the euro headed south vs. the dollar and its gains were erased. Last week ECB retained its key interest rate unchanged at 4.0%. Analysts believe that ECB will have to cut its lending rate in 2H 2008, since the situation in the economy is getting worse and consumers are dissatisfied with the cost of living, while the strong euro is hurting exporters.