Brussels, Jan 25 (IANS) There might be a moderate economic recession across Europe in the first half of 2012, a senior European Union (EU) official said Tuesday.
“Several factors pointed toward a moderate recession in the first half of this year, and the economic recovery in Europe is now likely to be postponed until the second half of 2012,” warned Olli Rehn, EU economic and monetary affairs commissioner.
Speaking at a press conference after a meeting of EU finance ministers, Rehn also said there had been an improvement in market sentiment in the past couple of weeks as the borrowing cost for EU states decreased, reported Xinhua.
Rehn’s prediction coincided with a similar warning from the International Monetary Fund (IMF) earlier Tuesday.
The IMF said in a statement that the 17-nation eurozone would likely slip into a mild recession in 2012, with output contracting by about 0.5 percent.
The IMF scaled down its forecast for world economic growth in 2012 from the original 4 percent to 3.3 percent, a growth rate that could be cut by another 2 percentage points if the eurozone debt crisis continue to fester.
