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Euro zone to gather speed - slowly

Thursday, November 05, 2015 - 01:40

German industrial orders dropped unexpectedly in September due mainly to weaker foreign demand, in a sign that Europe's biggest economy may lose steam at the end of this year. As Ciara Lee reports, it comes as the European Commission publishes its economic forecasts for growth, deficit and debt data for all the 28 countries in the European Union.

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Losing steam - German industrial orders dropped unexpectedly in September, with demand for 'Made in Germany' goods down 1.7 percent on the month. German factories received fewer bookings from abroad, driven by a 6.7 percent slide in demand from euro zone countries. It comes as the European Commission gave its outlook for the euro zone. And while Germany, the region's powerhouse is expected to grow, it will be at a slower rate. Overall, the region's recovery should pick up in the next two years, despite lower demand for exports in China and other emerging markets. 2015 should see growth of 1.6 percent Economics Commissioner Pierre Moscovici. (SOUNDBITE) (French) EUROPEAN ECONOMICS AND FINANCIAL AFFAIRS COMMISSIONER, PIERRE MOSCOVICI, SAYING: "This upswing is rather more muted than it has been in the past, but it has managed so far to resist certain uncertainties. The effects of the slowdown in emerging economies and the significant drop in international trade over the last few months, will however have effect." Not getting a gold star was France. It missed its EU targets and is on track for a budget deficit above the limits set by ministers for 2017. Commerzbank economist Peter Dixon. (SOUNDBITE) (English): PETER DIXON, GLOBAL FINANCIAL ECONOMIST, COMMERZBANK, SAYING: "We will have significant divergence's of performance across countries with the likes of Italy and France in terms of continuing to underperform. Germany struggling because of cyclical issues. And of course some of the other peripheral countries, notably Greece." With only Greece left in recession, growth in the region is now widespread. That's partly down to low oil prices and stimulus from the ECB. But the Commission warned the impact is now fading. It has reduced its 2016 outlook slightly to 1.8 percent.

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Euro zone to gather speed - slowly

Thursday, November 05, 2015 - 01:40