- Gilles Moec, co-head of European economic research at Deutsche Bank
The Eurozone economy is strengthening and fears of another recession have eased after the latest positive data. Moreover, the strength of the single currency is reflecting optimistic changes in investors' attitude towards the 17-nation bloc. According to the latest projections the economy will post a 1.4% growth in 2014, hence, there is a great opportunity for the Euro to strengthen further from the prospective of fundamental analysis. At the same time, Gilles Moec from the Deutsche Bank expressed his concerns that next year can bring disturbance on a political front.
Earlier this week data from the INSEE National Statistics confirmed that France, Europe's second largest economy, has almost stalled in the third quarter, posting a sluggish 0.1% growth. With Francois Hollande struggling to restructure the nation's economy, and his reforms being stifled at every turn, he is likely to lose some of his popularity. While latest polls showed Hollande's approval rating advanced two percentage points to 22% in December, posting the first uptick since August, polls also showed gains for Eurosceptic groups across the continent. This month European leaders moved closer to a creation of a banking union, so the shaky banking sector will no longer be a major drag on government finances. Nonetheless, Nick Spiro, head of Spiro Sovereign Strategy stressed out that political disintegration will be the main theme of the next year.
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