EU sees stronger euro zone growth, markets a risk

EU sees stronger euro zone growth, markets a risk
# 05 May 2010 14:24 (UTC +04:00)
Baku - APA-Economics. Euro zone economic growth should be stronger this year than previously thought and the budget gap lower, the European Commission said, but it warned of risks to recovery from financial market tensions sparked by Greece, Reuters reported.

In its twice-yearly economic forecasts for countries of the 27-nation European Union, the bloc’s executive said economic growth in the 16 countries using the euro would be 0.9 percent this year, rather than the 0.7 percent it projected in February.

The euro zone’s combined budget shortfall this year is likely to be 6.6 percent of the single currency area’s gross domestic product rather than the 6.9 percent forecast by the Commission in November last year, against 6.3 percent in 2009.

The aggregate deficit is to fall in 2011 to 6.1 percent of GDP, still more than twice the EU limit, the Commission said, as growth would accelerate to 1.5 percent next year.

The euro zone debt-to-GDP ratio is seen reaching 84.7 percent this year compared with 78.7 percent in 2009 and increasing further to 88.5 percent in 2011, the Commission said, slightly raising its November 2009 forecasts.
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