Brussels, 02/10/2001 (Agence Europe) - Whereas the Chief Economist of the ECB, Otmar Issing seems optimistic towards the strength of the economy of the euro zone, that is not necessarily "in crisis" (see article above), other people or organisations are less optimistic, some not hesitating in predicting global stagnation in the first half of 2002, recession even.
This is how the Credit Suisse First Boston (CSFB) announced on Monday the downwards review of its prediction on the growth of the gross domestic product in the euro zone from 1.8 to 1.2% for next year. Based on the current hypothesis of an inflation rate of 1.3% in 2002, rather than 1.5%, the CSFB expects the ECB to reduce its leading rate to 2.75% by the end of the first half of 2002 against the previous prediction of 3.25%.
Furthermore, going from 47.5 in August to 45.9 in September, the monthly overall index of economic activity established by the institute NTC Research for Reuters, published on Monday was set at its lowest rate since its creation in June 1997 and reflects the weakness of the European economy even before the attacks of 11 September. Industrial activity in the euro zone fell in September for the sixth time running, never before observed under the joint effects of a reduction in production and jobs and a lowering of orders, says NTC Research that does not hesitate in concluding that the manufacturing activity in the euro zone has entered recession. The institute stresses that the index of industrial activity has fallen to one of the most "historic lows" in eight countries of the euro zone, two of which "giants": Germany (45.1) and France (45.6).
Finally, in an interview to be published in the OECD's "Observer" review, the Organisation's Chief Economist, Ignazio Visco, considers that "growth in the second half of the year will be negative in the United States - sign of a recession - and weak in the EU". Consumers should play wait-and-see and put off their purchases and investments, he thinks, stipulating that this situation could continue in the first half of 2002. Activity in OECD countries should pick up once the sequels of the attacks have gone and "growth could return in 2003", he concludes.