The recovery will come, gradually, in the rest of the year and during 2014. Word of the European Central Bank, which in its latest bulletin is also optimistic as regards the risks for the economic prospects of the euro area, oriented towards the downside. The Frankfurt institute is not even frightened by the rating cuts of France and Italy by, respectively, Fitch and SStandard & Poor's, arguing that they “will have limited impacts on bond markets.
However, it will be a slow recovery, considering that the GDP growth expectations in real terms for the euro area have been revised downwards between now and 2015. Furthermore, the Central Bank expects that "the interest rates of baseline remain at or below current levels for an extended period of time. In essence, a timid restart after six quarters of contraction: "the recent indicators of the confidence climate based on the results of the surveys - states the bulletin - show some further improvement, starting from low levels, cautiously confirming the expectation of a stabilization of the economic activity at contained levels”.
The real ballast of the Old Continent is still the labor market: unemployment is confirmed at 12,3 percent for this year and in 2014 it will increase to 12,4 percentage points. This is why the Bank is asking the Eurozone countries for a "faster implementation of the necessary structural reforms in order to promote competitiveness, growth and job creation" and the "removal of rigidities in the labor market, the reduction of administrative burdens and the strengthening of competition in the market for goods and services of particular benefit to small and medium-sized enterprises". This, in summary, is the institute's recipe for combating unemployment, especially youth unemployment.
Finally, a reference to the deficit: "the countries of the euro area should not frustrate the efforts already made to reduce public deficits", with "budgetary strategies favorable to growth" and "with the reduction to a minimum of the distortive effects of taxation”.
