The euro zone economy is slowing more, the euro depreciates – BBC Russian

The euro zone economy is slowing more, the euro depreciates – BBC Russian

• January 6, 2015

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ECB President Mario Draghi said that the euro-zone economy threatens deflation

In December, the euro zone economy showed sluggish growth. The study shows that the fourth quarter was the worst in terms of the last year.

The business activity index of purchasing managers (PMI) market research firm Markit and the Chartered Institute of Purchasing and Supply (CIPS) in December reached 51.4 points, which was below forecasts, but above the November level of 51,1.

The growth of the euro zone economy in the last quarter of this year amounted to 0,1%.

In general, analysts say last 18 months, the euro zone economy grew, though not always, this growth has been impressive.

The PMI is compiled based on the analysis of indicators of the construction industry, the service sector and industry.

Since the beginning of the year in the eurozone had low inflation, in connection with which consumers put off major purchases and investments, expecting further price declines.

Reducing the cost of oil has exacerbated the problem. Since August of this year, the price of a barrel of Brent crude oil fell more than doubled – up to 51.54 dollars.

On Tuesday, the price of WTI crude oil in the United States for the first time since April 2009 dropped below $ 50 a barrel.

Deflation on the threshold of

Being afraid of deflation, the European Central Bank (ECB) cut its benchmark interest rate on loans up to 0,05%.

He also announced the launch of a program to repurchase different asset-backed securities to provide additional financial injections into the economy.

In this case, the ECB has decided not to follow the path of the central banks of Britain, the US and Japan and refused to redeem the public debt of the eurozone countries .

However, analysts expect that in January 2015 the ECB did announce early redemption of government bonds – this program is known as Quantitative Easing (“quantitative stimulus”).

In November inflation in the eurozone was 0.3%. Experts do not exclude that the December inflation figures for the first time since October 2009 will be negative.

A few days ago the head of the European Central Bank President Mario Draghi said the euro zone threatens deflation and that the ECB should counter this threat.

Against the background of these statements Draghi euro against the dollar on Monday fell to a nine-year low 1.1864 – last time this was observed in March 2006.