Europe emerging from a period to improve its financial situation that began in August last, when the President of the European Central Bank (ECB), Mario Draghi, announced that the ECB would do whatever it took to support countries in the Eurozone deficient. This intention is then translated by a specific program for Italy and Spain, to limit the level of interest rates on their debt.
Since a few days, however, an accumulation of issues such optimism has reversed.
- Political scandal in Spain
- The catalepsie de Banca Monte Dei Paschi di Siena en Italie
- The nationalization of the Dutch bank SAS Reaal
- The questioning of the proposed union European Banking
- Events to reduce the financing conditions of Ireland
It does not take long for the international markets react to the decline and investors are going back obligations Northern Europe and offload those of Southern Europe. A mi-chemin, la France perd du terrain. Que faut-il en penser ?
A certain complacency is installed in the corridors of Brussels, and in chancery. It is relatively a healthy reminder to order like the last ten days we do review the situation.
- Indebtedness of most European countries in relation to Gross Domestic Product is rising, despite efforts at fiscal deficits of Member States. With an average debt of the Eurozone (8.000 billions of euros) over 90%, any increase in interest rates impact the refinancing. L’Eurozone devrait refinancer environ 1.000 in billions of euros 2013. Reforms of the costs and revenues of government continue to impose.
- Economic lethargy does not seem to decrease. I prefer this term to the recession since the European GDP growth is around 0%. No growth, tax revenues are also lethargic and financial costs of states continue to be excessive.
- In this context, most European economies saw their unemployment rates increase, particularly in sectors such as automotive and difficulties in countries like Spain deficient.
The question that remains is whether this or will to improve. Fundamentally, this is the strength of the U.S. economic recovery we can expect an early growth at the end of 2013. The typical euphoria of January is now up to greater sobriety. But the creation of 157.000 jobs in January 2013 was good news.
But the weakness of Europe is the situation of its banks. Ads of the European banking union can not hide that the project which has delivered the Commission with the support of the ECB for the Eurozone raises more questions than it answers. Control by the ECB engenders widespread skepticism. Monte dei Paschi reminds us control weaknesses central banks.
Without going into a pessimism that has no reason to be, should not diminish the vigilance Eurozone needs to restructure.