"The upside for domestic demand in the Eurozone is likely to remain constrained for some time to come by restrictive fiscal policy in many countrie"
- IHS Global Insight Chief UK and European Economist Howard Archer
The industrial output in the 17-nation economy rose more strongly than expected in February, boosted by a marked gain in energy production, suggesting that the currency bloc is recovering gradually from the severe debt crisis. Region's output rose 0.4% in February compared with January, when it dropped 0.6%, beating analysts' expectations of a 0.3% increase, the official data showed Friday. Despite the improvement, recent economic data for the currency-bloc paint a bleak picture, and risks of another quarterly contraction in the gross domestic product are still high.
"The upside for domestic demand in the Eurozone is likely to remain constrained for some time to come by restrictive fiscal policy in many countries, still tight credit conditions, very high and rising unemployment, and limited consumer purchasing power," IHS Global Insight Chief UK and European Economist Howard Archer said.
"This is particularly true of the southern periphery Eurozone countries, and we expected extended contraction in both Italy and Spain to weigh down appreciably on overall Eurozone GDP in 2013. We also suspect that France will find growth elusive in 2013."
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