So, is it actually the euro zone that’s strong and stable?

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So, is it actually the euro zone that’s strong and stable?

European Union flags flutter outside the European Commission headquarters in Brussels, Belgium, June 4, 2015. REUTERS/Francois Lenoir

Reuters

The deluge of cash poured into the euro zone economy in recent years by the European Central Bank appears to have finally resulted in solid – and more importantly, steady – economic growth, along with rising inflationary pressures.

To borrow a phrase from British Prime Minister Theresa May’s ill-fated election campaign, it’s beginning to look strong and stable.

As well as cutting borrowing costs to rock bottom, the European Central Bank has bought well over a trillion euros of mainly government bonds as part of a battle to drive growth and get inflation back to its 2 percent target ceiling.

At last, the ultra-loose monetary policy appears to be paying dividends. Euro zone growth hit its fastest rate in two years at the start of 2017, and while it has probably slowed a tad this quarter, it remains robust. [ECILT/EU]

This has turned a well-established industry of bemoaning the single currency bloc’s poor performance on its head.

“The ECB’s billions are increasingly filtering through to the real economy. It is somewhat through gritted teeth that we expect two to three further years of buoyant euro zone economic growth,” said Jorg Kramer at Commerzbank.

A flash purchasing managers’ index on the coming Friday will provide the first clue on whether May’s momentum, which suggested quarterly economic growth of 0.7 percent, has carried into June. A Reuters poll predicted it largely has.

“The euro zone has led the developed world upturn, according to the PMI surveys, with the region enjoying its fastest growth for six years…Read More

Lakeem Khodra
Lakeem Khodra
News Writer/Contributor at Tyranny News @lakeemk

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