OECD Economic Surveys: Euro Area

Description

The adoption of the euro represented a major step forward towards deeper economic integration. However, developments in the first five years of the single currency have been challenging. The global slowdown has affected the euro area more strongly than had been expected, with below potential growth continuing for four years. Growth has been recovering more slowly than elsewhere, with domestic demand staying particularly weak as consumer confidence failed to rebound. The OECD is projecting the recovery to gather steam in 2005, with growth of 2½ per cent. Unemployment is projected to stay stubbornly high, while inflation is expected to ease to below 1½ per cent in 2005.



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