Economists say Europe is flat

Cleveland News.Net
Thursday 24th July, 2008

Economists have warned that the 15-nation eurozone economy is teetering on the brink of recession.

Business activity in the eurozone has almost come to a halt according to a group of leading indicators.

The eurozone purchasing managers index slid more sharply than expected in July to 47.8 points from 49.3 in June, according to an initial estimate.

Separate business confidence surveys from eurozone economic heavyweights Germany, France and Italy have added to fears that Europe will not escape recession as it struggles with record inflation, tight lending conditions and weakening export demand.

German business sentiment fell to near a three-year low point in July, and France's INSEE business climate index fell in July for the sixth month running to hit the lowest level since May 2005.

The Italian business confidence level dropped to a near-seven year low.

In Spain, the government slashed its economic growth forecast for this year to 1.6 percent from 2.3 percent as a housing boom failed.

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