The European Commission made no change today to its forecast of a slight acceleration of euro zone economic growth in the third quarter despite more upbeat comments from euro zone finance ministers.
The commission kept its May estimate of the 12-nation euro zone gross domestic product growth of 0.1-0.5 per cent in the second quarter against the first quarter and 0.2-0.6 per cent in the third quarter.
This is more cautious than remarks from Luxembourg Prime Minister and Eurogroup chairman Jean-Claude Juncker on Monday, when he said euro zone finance ministers had agreed the third quarter would be "fundamentally better".
The economy's disappointing performance in the first half of the year, partly due to record high oil prices, made euro zone finance ministers cut their full year growth forecast for euro zone on Monday to 1.3 per cent from 1.6 per cent.
The commission says Europe needs to at least double its growth rates if it wants to maintain its generous welfare and social model in the face of tough competition from Asia.
But such acceleration would require extensive labour market reforms, deeper cross-border economic integration and long-term investment in research and education at a time when three of the euro zone's biggest economies - Germany, France and Italy - all face elections over the next two years.