IMF fears for the eurozone
13 April 2012
THE International Monetary Fund cut its growth forecasts for the woebegone eurozone once again. And it hinted that the European Central Bank might need to cut interest rates again to revive the flagging economy, which is skirting recession.
It expects the 12-country single currency area to grow only 0.5% this year, a dramatic fall from the 1.1% it forecast as recently as April. And it sees growth of 'about 2%' in 2004, down from 2.3%.
The IMF urges the European Central Bank to maintain a 'sustained easing bias', which means keeping rates low and possibly cutting them again. Rates are currently 2%.
It also sees inflation falling to just 1.6% next year from 2% in 2003.
