Monday 19 January 2009

European Commission predicts 1.9% shrinkage of eurozone economy

As a general rule, it isn't the done thing to mock the afflicted but in the case of the EU I think we can make an exception.

The European Commission has predicted that the eurozone economy will shrink by 1.9% in 2009 and will grow by only 0.4% in 2010. Estimates for the UK economy range from anywhere between 1% shrinkage to 2.9% with the economy predicted to return to full growth in the second half of 2009.

Of course, it's the Tartan Taxman that is doing the predicting for the UK economy so it needs to be taken with a pinch of salt but even if the UK were to experience the full 2.9% shrinkage of the economy, the early return to growth will put the UK on the road to recovery that much earlier.

Over the last week, the Euro has dropped against, amongst others, the Albanian Lek, the Angolan New Kwanza the Cuban Peso, the Gambian Dalasi, the Kazakhstan Tenge, the Moldovan Leu, the Rwandan Franc, the Somali Shilling, the Tongan Pa'anga and the Zambian Kwacha (source: In fact, the only currency the Euro seems to have rallied against in the last week is the Zimbabwean dollar which went from €21.5m to the Z$ to €22.8m to the Z$.