September 15, 2011
The EU Commission today warned that economic growth in the eurozone will come to a near standstill by the end of the year due to the European debt crisis and turmoil in the financial markets.
In its latest economic forecast, the commission said the financial gloom is likely to persist until spring next year, but it would not result in a double dip recession.
Economic growth in the 17 euro countries will be only 0.1 per cent in the fourth quarter – down from 0.2 per cent in the third.
For the second half as a whole, the commission said it had revised down its prediction from its spring forecast by half a percentage point.
The worsening debt crisis and financial market volatility has dampened economic activity says the forecast.
Olli Rehn, the EU’s economic and monetary affairs commissioner, said: ‘The outlook for the European economy has deteriorated.