Eurozone Update

The Eurozone has been struggling for a stronger foothold since the crisis broke out nearly 5 years ago. Things did seem to be looking better a few months back when the zone reported a growth of 0.3%. This came as a relief for the 17 member bloc which had seen a de-growth for the previous six quarters in a row. Everyone thought that this was a sign that things would be on the mend thereon. But the latest numbers from the region have cut short the celebration. The growth this quarter is estimated to be just 0.1%. Though the number is not strictly comparable to previous quarter's numbers as there is a seasonal one-off related to Germany; however there was a considerable slowdown seen in other countries as well. This brings back the question as to whether the Eurozone's recovery is sustainable or not. 

The zone still has countries laden with debt that have been handed out bailouts after bailouts. Though they have enacted austerity measures in lines with the bailout requirements, however even then their financial situation is precarious. Add to this the high levels of unemployment weak investments and tight credit conditions. As per CNNMoney, the European Central Bank (ECB) has stated that it would take measures including further interest rate cuts to help revive the situation. This means that the money printing exercise of ECB will most likely continue. However if the ECB and the Eurozone takes a cue from US, they would realize that money printing just postpones crisis. It does not resolve i