Europe will avoid a return to recession, despite the continuing eurozone sovereign debt crisis and volatile investment markets.
This is the conclusion reached by Jose Manuel Barroso, president of the European Commission.
He made the comments about prospects for the European economy as a whole after ratings agency Standard & Poor’s forecast an increased risk of a double dip recession in the eurozone.
Standard & Poor’s is forecasting economic growth of 1.7% for the eurozone this year, which is a downwards revision from its previous estimate of 1.9%.
Despite the confidence of the European Commission and modest growth forecast from Standard & Poor’s, economic recovery in Europe (and indeed globally) is likely to be modest in the near future.
In the UK, recent figures suggest the economy is struggling to continue along a path of growth.
Retail sales in the UK fell in August, as a result of poor consumer confidence and continued high price inflation. The latest British Retail Consortium figures show like-for-like sales falling by 0.6% compared to the previous month.
Activity in the food sector appears to remain resilient, although non-food sales are suffering as consumers choose to stay at home rather than spend their money.
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