Publications
Partners
Brussels - The European Union admitted "concern" Monday at the power of financial markets to sow "turbulence" undermining economic recovery and create further policy-making "tensions."
"The financial-market situation remains a concern, with further tensions possible, as highlighted by the reappearance of stress in sovereign-bond markets lately," the European Commission said in releasing new economic forecasts for 2010-2012.
The data came the morning after EU finance ministers and the International Monetary Fund sealed their second eurozone bailout of the year, with analysts tipping first Lisbon and ultimately even Madrid to be the next to need aid in potentially breaking-point emergency rescues.
The commission revealed it was more pessimistic than Portugal and Spain on their respective deficit reduction plans, while warning also of a slowing in the rate of eurozone economic growth next year to 1.5%, before rebounding to 1.8% in 2012.
Similarly, national debt levels for bailed-out Greece and Ireland, plus politically divided Belgium, are each set to rise beyond 100% of Gross Domestic Product, or one year's economic output, in 2012.
The bright spot on the EU's forecast horizon, though, was a projection showing that the unemployment rate should gradually fall to about nine percent by 2012, having hit a record one-in-10 during the aftermath of the world's deepest recession since the 1930s.
