The European Central Bank said today that the economic fundamentals for the 12-country euro zone remain "positive" and it sees "a good base for recovery in the course of the next year."
Despite the economic shock of the terror attacks in the United States on September 11th, "there are no major imbalances in the euro area which would require a lengthy period of economic adjustment," the ECB wrote in its October monthly bulletin.
"On account of policies aimed at price stability, fiscal consolidation, wage moderation and structural reform, the euro area fundamentals remain positive," the report said.
"Financing conditions are favourable and the expected decline in consumer price inflation should provide further support to household consumtpion in the euro area.
"Taken together, all these elements should provide a good base for a recovery in the course of next year once the initial shock has been absorbed. This notwithstanding, downside risks to the current prospects will have to be monitored."
AFP &