The European Commission is warning the Spanish and Italian governments that their draft budgets for 2014 do not comply with new debt and deficit rules. The Commission also said that France and the Netherlands barely qualified for the new standards.
According to the European Union’s charter, countries that do not comply will likely have to revise their tax and spending plans before they can be submitted to national parliaments. The warning marks the first time the EC has taken this step.
Eurozone members states are required to cut deficits until they reach a balanced budget. They also have to reduce levels of public debt. The Commission usually gives countries flexibility if their deficit is below the EU ceiling of 3% of the nation’s gross domestic product.
The Commission said that France, while just below the 3% threshold, was making only “limited progress” in reforms.
The Eurozone economy grew by .1% from July to September in data released Thursday, down from .3% growth in the previous quarter.
The Eurozone showed 0.3% growth from April to June meaning the group is officially out of a recession. It was the first major growth since the third quarter of 2011.
The report of the zone’s growth was expected by most economists after the biggest economy in the zone, Germany, drew 0.7% during the same period. Continue reading →
The number of unemployment in the Eurozone fell during June for the first time in over two years although the overall unemployment rate did not change.
The jobless total of 19.26 million was 24,000 less than last month, the first fall since April 2011. The overall unemployment rate held at a record 12.1%. Continue reading →
The ongoing crisis in the Eurozone has led the International Monetary Fund to call for more action to help increase bank lending.
The IMF commended steps taken by European leaders to stabilize financial markets and said their actions decreased the likelihood of a breakup of the Euro. However, the IMF report said that further cuts to interest rates by the European Central Bank would be needed to boost growth. Continue reading →
The Eurozone debt crisis, which has stabilized over the last year, is in danger of seriously exploding as the government of Portugal is threatening to collapse.
Portugal’s Prime Minister made a national address Tuesday night saying he refused to accept the resignation of the country’s foreign minister and that he would try to go on governing. Continue reading →
New car sales in Europe hit the lowest point since 1993 in May.
The continual slide in sales is attributed to the worsening recession across the continent.
Registration of new cars fell to 1.04 million in May and the trends shows a danger of falling below 1 million in upcoming months. The last time registrations fell below 1 million was May 1993. Continue reading →
Portugal’s prime minister is warning that unless deep cuts are made to social security, health, education and public programs the nation could be facing a second bailout from the European Union.
Prime Minister Pedro Passos Coelho said the country is facing a “national emergency” and that because the Portuguese Constitutional Court struck down 1 billion euros in savings that were required to meet existing bailout conditions there was no choice but to cut in areas like welfare. Continue reading →
The Markit composite purchasing managers’ index, which measures the growth in manufacturing and services sectors, has reported significant downturns in major European economies. Continue reading →
Eurozone finance ministers were holding unscheduled meetings trying to find a “plan B” for Cyprus as the country’s financial system is rapidly collapsing beyond their control.
The country’s banks have been shut until next week because of a run on savings accounts. Rumors that the European Union and the International Monetary Fund would require all Cyprus account holders to sacrifice a portion of their savings to obtain a bailout of the nation. Continue reading →
Cyprus is the latest European nation to be on the verge of receiving an EU bailout.
Finance ministers from EU countries are meeting today to discuss a $22 billion (U.S.) bailout of the island nation. Germany is resisting and insisting that those who have deposits in Cyprus banks pay for the rescue calling it a “bail-in”. Continue reading →