European Union finance ministers meet in Brussels today amid signs that Europe's economic recovery may have begun sooner rather than expected.

But the ministers are expected to call on EU leaders to take action at next week's summit in Barcelona to speed up economic reforms and improve economic policy co-ordination.

The Business Climate Indicator for the euro area rose by almost 0.2 points in February, reaching a value of -0.86. Consumer confidence rose too, with most consumers predicting that the general economic situation would improve over the next year.

The rise in business confidence is mainly due to increasing order books, particularly in export orders.

A spokesman for the Economic Affairs Commissioner, Mr Pedro Solbes, welcomed the new economic data, adding that the figures appeared to confirm the Commission's prediction last autumn that the economic recovery would start in the first half of 2002 and gather pace later in the year.

Euro-zone finance ministers met in Brussels last night to discuss, among other issues, evidence that the euro cash changeover may have fuelled inflation.

All 15 EU finance ministers will today adopt a "key issues" paper that will determine the Broad Economic Policy Guidelines for 2002.

The paper, which will be sent to EU leaders for approval in Barcelona, calls for more action to liberalise the European market in goods and services, particularly in the energy sector.

France has resisted energy liberalisation until now, despite the fact that French companies are among the most active in other EU energy markets.

EU leaders have set themselves the task of making the EU the world's most competitive economy by 2010.

Britain wants the Barcelona summit to agree sweeping changes to labour laws that would introduce more flexibility to the labour market.

But some member-states fear that such steps could prove harmful to the European social model and erode workers' rights.