The Conference Board Economics Watch® - European View

  • The European debt crisis and the increased risk of recession are reinforcing each other and threaten to trigger a new banking crisis.
  • Global growth, previously forecast for 4.3 percent, may fall below 4 percent in 2011, which will weigh on growth in core Euro Area economies.
  • Easing inflation may support consumption and allow the European Central Bank (ECB) some room for policy maneuvering, but there are limits to what central bankers can do at this time.
  • At the aggregate level, the Euro Area is self-sufficient. The key challenge for policymakers is to restore the financial flows from surplus countries to deficit countries.
  • Structural reforms aimed at boosting employment and productivity are critical to placing debt levels on a more sustainable path in the medium to long term.

Economics Watch Reports (5 pgs)
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