A few months’-worth of good data do not a recovery make. However, better-than-expected news since the turn of the year has given Bank of England’s economists cause for optimism, which they duly factored into the latest growth forecasts.
Not so their counterparts at the European Commission.
While the Monetary Policy Committee has raised its 2012 growth estimates in recent months amid signs of a nascent recovery, in a more-or-less uniformly grim forecast of the economic outlook for Europe, the Commission on Thursday left its estimate for the UK, last recorded in November, at 0.6 per cent. Read more
Greece’s fiscal problems are huge, but have been amplified because nobody can trust the numbers it produces. A European Commission report just released on the Greek statistical service is as damning you can imagine a Brussels institution preparing. It reveals how figures on the country’s public finances have been persistently mis-reported since before Greece join the eurozone in 2001 – a step it would never have been allowed to take if what is known now was known then.
Perhaps this offers part of an answer to the question of why Greece is such a big deal to the eurozone when the problems of California - a much bigger economy – are not of such existential importance to the US (see my earlier post). Athens has created such bad feeling in Brussels and at the ECB in Frankfurt, and the sense that nobody really knows what is going on with the Greek economy – except that it is bad. Read more
How the crisis might have saved the euro: Ralph Atkins reads between the lines of the European Commission’s forecasts and discovers the credit crisis has helped to correct some significant pre-crisis current account imbalances Read more