The eurozone economy has long been a source of uncertainty, in the past decade has been one of the best years, clearly prove it out of the long-term debt crisis, which leads to the concerns of the euro currency.
Higher than healthy growth means the eurozone economy will grow by 2.5 per cent for the whole of 2017, its best performance since growth of 3 per cent in 2007. The euro area grew by 2.3%, even faster than America’s.
“Growth in 2017 has become a path of rapid growth,” says Bert Colijn, European regional economist at ing. Details have yet to be released, but the eurozone economy appears to be continuing to fire on all the pillars.
In the decade since 2007, the eurozone has had to cope with another crisis, starting with the 2008 financial crisis and triggering the world’s worst recession since world war ii. This exposes the weaknesses of the eurozone – the public finances of some member states.
Four countries – Greece, Ireland, Portugal and Cyprus – its partners in the euro zone has to be signed, and the international monetary fund to bail out, and in return, they decided to cut the budget, in order to realize the formation of public finance, and make its economic difficulties. Greece, for example, accounts for about a quarter of its economic output, with high unemployment and poverty.
Until recently, worries about the euro had eased. Notably, Greece will be bailed out this summer, eight years after its first bankruptcy.
Overall confidence in the eurozone rose on fears of a break-up. This suggests that growth is not just dependent on the big economies of Germany and France. Countries at the forefront of the crisis are recording stronger growth, which could help reduce unemployment and further strengthen the recovery.
Fears about the future of anti-euro politicians have waned after the elections in France and the Netherlands and after several failed populist political campaigns in 2017. Meanwhile, the European central bank’s massive stimulus package and interest rate cuts have boosted the recovery.
But the benefits of growth go beyond improving the eurozone. The global economy, particularly trade, is on the rise, providing support for eurozone exporters.
These positive factors are widely expected to continue to grow in 2018 and are expected to grow around 2017. Two potential downsides are the recent rise in the euro, particularly against the dollar, which makes euro zone exports less competitive in international markets and the ECB less stimulative.
After growing, the euro rose further against the dollar, recently hitting a three-year high and rising 0.3 percent to 1.2414.