Arab Today, arab today eurozone economy stagnates as ecb leaps in to action
Last Updated : GMT 12:46:35
Arab Today, arab today
Arab Today, arab today

Eurozone economy stagnates as ECB leaps in to action

Arab Today, arab today

Arab Today, arab today Eurozone economy stagnates as ECB leaps in to action

Working site
Brussels - AFP

The eurozone economy stagnated in the second quarter, official figures showed on Friday, in line with the poor outlook which pushed the European Central Bank into radical action on Thursday.
In a second estimate for growth in the 18-country currency zone, the Eurostat statistics body confirmed zero percent growth from the previous quarter.
It also reported slight expansion of 0.2 percent for the full 28-country European Union.
"The second quarter stagnation in eurozone GDP clearly added to the pressure on the ECB to take further stimulative action sooner rather than later to try and dilute the risk of extended low consumer price inflation morphing into deflation," said economist Howard Archer at IHS Global Insight.
Eurozone economic activity also suffered "as heightened global geopolitical tensions, particularly the Ukraine/Russia crisis, weighed down on investment," he said.
The first estimate announced in mid-August sent shockwaves across financial markets and governments desperate for growth, and put even more pressure on the ECB to take action.
It did so in unexpected fashion on Thursday, when ECB president Mario Draghi produced the latest in a series of policy surprises, while also warning that the real solution was faster reforms by governments.
Concerns are growing that the European economy, after making it through the euro crisis and the prospect of the collapse of the single currency, may now be poised for years of stagnation or unduly low growth.
Stunted growth in the eurozone is forcing governments to cut back their estimates for growth of gross domestic product for the rest of the year, putting budget deficit targets into jeopardy, and also clouding the outlook for growth of the global economy.
The unexpectedly low growth figure was mainly the result of a surprise 0.2-percent shrinkage in Germany, usually the reliable eurozone growth engine, and stagnation in an already fragile French economy.
Feeling the pressure, the Frankfurt-based ECB cut interest rates to a record low level on Thursday and pledged to buy hundreds of billions of euros of private sector bonds, thereby pumping much-needed cash into the economy.
However, Draghi also revealed that the ECB's policy council was split, since the decisions announced were not taken unanimously.
-'Support act'-
The effects of the ECB's deflation-fighting measures were still being felt on Friday, with the euro still trading just below the $1.30 mark, a key target for governments seeking to promote exports with a more favourable exchange rate.
Despite the surprise moves, economist Holger Schmieding of Berenberg Bank said the ECB could now play only a "support act" in turning around the economy, unlike the instrumental role it played in ending the debt crisis.
"A lack of dynamism in France and Italy and Russia’s aggression in Ukraine have interrupted the recovery. These factors are outside the ECB’s control," Schmieding said.
The rate cut and bond-buying "will help, but not solve all problems," he said.
The ECB also cut its forecasts for growth in the 18-country euro area this year and next, and lowered its outlook for area-wide inflation.
The ECB is now pencilling in gross domestic product growth of 0.9 percent in 2014 with inflation expected to be 0.6 percent this year -- a lower rate than the 0.7 originally forecast.

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today eurozone economy stagnates as ecb leaps in to action Arab Today, arab today eurozone economy stagnates as ecb leaps in to action

 



Arab Today, arab today
Arab Today, arab today Saudis await visitors but will they come?

GMT 11:54 2017 Thursday ,23 February

Saudis await visitors but will they come?
Arab Today, arab today Sarah Belamesh designs antiques of "ceramic"

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"
Arab Today, arab today Blind sheikh buried in Egypt

GMT 06:32 2017 Thursday ,23 February

Blind sheikh buried in Egypt
Arab Today, arab today Media host Mona Iraqi stresses her show's success

GMT 15:32 2017 Wednesday ,22 February

Media host Mona Iraqi stresses her show's success
View News in Arabic - Business: اقتصاد دولي
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today To hold social dialogue over secondary school

GMT 07:43 2017 Wednesday ,22 February

To hold social dialogue over secondary school
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Salma Rashid happy for 'A Whisper of Love'

GMT 05:19 2017 Tuesday ,21 February

Salma Rashid happy for 'A Whisper of Love'
Arab Today, arab today Milan laughs while Rome cries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 06:41 2017 Monday ,20 February

Janat pleased for issuing 'Good Morning'

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 14:29 2017 Monday ,20 February

Prepares to present her new collection

GMT 15:53 2017 Tuesday ,21 February

Small ponds have outsized impact

GMT 23:29 2017 Thursday ,16 February

Home built on sand castles-style costs $8m

GMT 07:51 2017 Wednesday ,22 February

Mom's immune system accepts babies

GMT 17:46 2017 Saturday ,18 February

Tourist guide reveals methods of tourist attractions

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 12:39 2017 Monday ,20 February

newest smartphone another winner for Huawei

GMT 19:10 2017 Friday ,17 February

Hats, scarves add beauty to women
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday