"We are clearly now growing at a global level with some good surprises in some advanced economies. I think Europe has done [a lot of hard work] in its adjustment."
- Jean-Claude Trichet, the former head of the European Central Bank
Austerity measures and reforms have been put under scrutiny as they showed little effect during the financial crisis. However, with the 17-nation economy now out of its longest-ever recession, the former head of the ECB Jean-Claude Trichet praised central bank's policies and austerity measures. The next year would be followed by a solid growth, even despite the fact that some of the peripheral economies still struggling to grow. Though, despite Trichet's sanguine appraisal of Mario Draghi's actions, there are still key concerns for the policymakers. Hence, there is a risk of deflationary trend in the region, while unemployment still hovers around record high. Moreover, the economy logged a sluggish growth in the third quarter, while another concern is Fed's decision to start reining in its stimulus programme in January.
Another optimistic sign for Europe is last week's tortuous agreement on a common system that will help to deal with failing banks. This is the biggest leap forward the creation of a banking union, and hence a close integration, since the launch of the since currency in 1999. Starting from the next year the ECB will become a supervisor for bloc's 126 biggest banks, reducing a risk of another banking crisis. The last but not least fact that speaks in favour of economic prosperity is last year Draghi's pledge to do whatever it takes to save the currency, that ended speculation of a possible break-up.
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