The Euro Area outlook is improving, with surveys indicating that consumers and businesses are more optimistic about the economy. The Conference Board Leading Economic Index® (LEI) for the Euro Area, for example, rose for the seventh month in a row in December. Positive news about unemployment and GDP in Spain give hope for the recovery of Europe’s troubled economies in 2014. Confidence in European government finances has driven the recovery, even though debt-to-GDP ratios are at record highs. Low investment rates and structural rigidities are hurting Europe’s long-term growth prospects, and total factor productivity remains negative.