Crisis-hit Eurozone economies set to fall even further behind
EUROPE’S troubled economies are falling further and further behind those in the rest of the continent and the world, two reports showed yesterday, suggesting the pain of the Eurozone crisis will not be over any time soon.
The OECD’s leading index showed the German and British economies at a turning point, and likely to gather steam over the coming six months, while the US and Japan are showing stronger positive signals.
The composite leading index (CLI) for the OECD as a whole rose to 100.5 in March, from 100.4 in February and above the long-term average of 100.
Emerging markets have a healthy and recovering outlook, with China’s CLI rising from 100.3 to 100.4, India’s from 98.7 to 98.9, and Brazil’s from 98.4 to 98.7.
However France and Italy saw their CLIs moving in the opposite direction, falling from 99.7 to 99.6 and from 99.3 to 99.2 respectively, adding to worries of a further slowdown.
The Ifo and World Economic Survey (WES) Eurozone business climate indicator improved from 84.8 in the first quarter to 100.3 in the second, but remains well below the 118.9 seen a year ago.
The expectations index also improved from 70.5 to 91.8, but again is down on last year’s 95.1.
The index also showed stark divisions between economies within the currency area.
“In Germany and Estonia the current situation remains good, while in Finland it is deemed satisfactory,” read the report.
“No positive developments were reported in Greece, Portugal, Italy, Spain or Cyprus. WES experts give the current economic situation in these countries the worst appraisals on the WES scale and expect a recession in 2012.”
“Public deficits continue to create major problems in the entire euro area, as well as high unemployment in the euro crisis countries, according to the economic experts surveyed,” the report concluded.