Eurozone growth expected to improve:European Commission

BRUSSELS, 5th February, 2015 (WAM) — The eurozone economy will grow more than expected this year and next on the back of low oil prices, the euro’s depreciation and stimulus measures, the European Commission predicted Thursday in its newest forecast.

Today Europe stands at a critical juncture, said Valdis Dombrovskis, the commission’s vice president for matters relating to the euro. “We have to step up the reform momentum to strengthen the recovery and make sure it translates into money in people’s pockets.” The fall in oil prices and the cheaper euro are providing a welcome shot in the arm for the EU economy, added Economy Commissioner Pierre Moscovici. But there is still much hard work ahead to deliver the jobs that remain elusive for millions of Europeans.

The commission now believes that growth in the eurozone will reach 1.3 per cent of gross domestic product (GDP) this year and 1.9 per cent in 2016 – up 0.2 percentage points from its previous economic forecast in November, according to dpa.

It also revised upward growth forecasts for the biggest economies in the bloc, reaching 1.5 per cent and 2 per cent for Germany this year and next 1 per cent and 1.8 per cent for France 0.6 per cent and 1.3 per cent for Italy and 2.3 per cent and 2.5 per cent for Spain.

Unemployment in the eurozone remains high and its investment environment is still weak, the commission acknowledged, but said that landmark quantitative easing by the European Central Bank and a new investment plan launched by the commission are helping.