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Thursday, January 7, 2016

Eurozone set for better economic growth - China permitting

The gyrations in Chinese financial markets this week have been stoked by worries over the scale of the slowdown in the world's number 2 economy, leading investors to scale back expectations for global growth this year. The transition to 2016 has been marked by positive economic data that has raised hopes of a more buoyant economic recovery. On Wednesday, a survey of the manufacturing and services sectors by financial information company Markit showed growth in the fourth quarter running at its highest level in 4-1/2 years. [...] good news came Thursday from the European Commission, the EU's executive arm, which said its economic sentiment indicator for the region is also running at a 4-1/2 year-high. Sliding oil and commodity costs have given consumers and businesses more to spend while the lower euro has been a boon to exporters. [...] the European Central Bank has embarked on a monetary stimulus program that is designed to keep a lid on borrowing rates. The great fear at the European Central Bank is that the current era of low, and sometimes negative, inflation rates turns into a debilitating bout of deflation — when consumers start putting off spending in the expectation of lower prices in the future. [...] Greece looks like it's headed for recession again as strict controls on money flows take their toll — withdrawals at ATMs, for example, have been limited for more than six months. [...] France, the eurozone's second-largest economy, is stalling, with sentiment likely undermined by November's attacks in Paris that killed 130 people.


READ THE ORIGINAL POST AT www.sfgate.com