Recent events in Italy, Cyprus and Portugal have put a dent in hopes that the three-year crisis in the euro-zone is finally drawing to a close. Meanwhile, previous tentative signs that the broader economy might be recovering in response to the period of relatively calm financial market conditions appear to be fading. With global growth weak and fiscal austerity still biting, we maintain our well-below consensus forecast that the euro-zone economy will contract by as much as 2% this year. Against this background, the dangers of renewed bouts of market turmoil and uncertainty over the future of the currency union are set to persist.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services