Euro zone expects growth of 1% in 2010

| February 16, 2010 | 0 Comments
Euro zone expects growth of 1% in 2010

Eurogroup chairman Jean-Claude Juncker has said the euro zone economy will grow by about 1% in 2010.

The chief of the 16-member nation, who is also Luxembourg’s Prime Minister, said: “Growth is on the path of consolidation but growth in 2010 will be fragile, moderate.”

The euro zone has hit the headlines over the last few weeks due to the severe debt crisis in Greece, which has weakened the value of the euro and driven Government bond yields higher.

The economic downturn hit the euro zone particularly hard and the region contracted by 4% over the whole of last year - its biggest fall since the euro was introduced over a decade ago.

Official figures last week revealed the euro zone economy grew just 0.1% in the final three months of 2009, suggesting the economic recovery is faltering.

The figures led many analysts to believe that the European Central Bank will keep interest rates at the record low of 1% until at least the fourth quarter of 2010.

Furthermore, it is expected that European Governments will maintain fiscal stimulus packages to boost their economies.

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