News / Economy

    French Pessimism Holds Back Rise in Eurozone Morale

    French President Francois Hollande looks on during a press conference at the Moncloa palace as part of an Hispano-French summit in Madrid, Nov. 27, 2013.
    French President Francois Hollande looks on during a press conference at the Moncloa palace as part of an Hispano-French summit in Madrid, Nov. 27, 2013.
    Reuters
    Most Europeans felt more optimistic about a recovery in the eurozone in November, but pessimism in France underlined the sluggish performance of the bloc's second-largest economy.
     
    Economic sentiment in the 17 countries using the euro strengthened by 0.8 points to 98.5 in the seventh straight month of gains, according to a European Commission survey on Thursday, beating economists' expectations.
     
    The business climate reading turned positive for the first time since March last year.
     
    But loans to households and companies in the eurozone shrank at a sharper pace in October, European Central Bank data showed, keeping pressure on policymakers to do more to buoy the recovery.
     
    The eurozone is trying to pull out of a deep banking and public debt crisis that nearly shattered the currency area.
     
    Record unemployment and a shortage of bank lending are a serious drag on a recovery that began earlier this year.
     
    But the business survey showed that of the eurozone's five largest economies, only French morale slipped, while sentiment in Italy, Spain, the Netherlands and Germany continued to strengthen.
     
    “The numbers are very encouraging given that in October there were signs that the economic upturn was stalling,” said Sarah Hewin, head of European research at Standard Chartered. “We shouldn't downplay the importance of France, but this suggests momentum is picking up,” she said.
     
    French business activity shrank in November, as high labor costs and a lack of reforms hurt exports.
     
    French pessimism was most notable in the European Commission's measure of eurozone consumer sentiment, which declined this month, halting an upward trend over the past year.
     
    “This was mainly due to a sharp decline registered in France and reflected worsening expectations about the future general economic situation,” said the Commission, the EU executive arm.
     
    Standard & Poor's cut France's credit rating earlier this month by one notch to AA from AA+ and the Commission sees France expanding by 0.2 percent in 2013 and 0.9 percent in 2014.
     
    ECB may still move

    Despite a return to economic growth in the April-to-June period, the economy barely grew in the third quarter and economists say the European Central Bank will have to do more to support growth.
     
    Spain, which emerged from a two-year recession in the July-September period, saw economic sentiment increase by 1.4 points in November.
     
    That was a stronger reading than in Germany, the euro zone's biggest economy, and showed Spain regaining the business dynamism it lost during a decade-long property boom that eventually burst and forced a eurozone bailout of its banks.
     
    Overall, the bloc's services sector registered a nearly three-point jump in November. Confidence in industry also rose in the eurozone, but fell in construction and financial services.
     
    Paris-based think tank the Organization for Economic Cooperation and Development called on the ECB last week to emulate U.S.-style quantitative easing, or QE, and the bank's vice president has said all options are open.
     
    Inflation in the 17-nation eurozone fell to its lowest in nearly four years at just 0.7 percent in October, prompting the bank to cut rates to a record low of 0.25 percent.
     
    “This month's rate cut was probably not the final move from the ECB to fight the crisis,” said Peter Vanden Houte at ING.

    You May Like

    Hope Remains for Rio Olympic Games, Despite Woes

    Facing a host of problems, Rio prepares for holding the games but experts say some risks, like Zika, may not be as grave as initially thought

    IS Use of Social Media to Recruit, Radicalize Still a Top Threat to US

    Despite military gains against IS in Iraq and Syria, their internet propaganda still commands an audience; US officials see 'the most complex challenge that the federal government and industry face'

    ‘Time Is Now’ to Save Africa’s Animals From Poachers, Activist Says

    During Zimbabwe visit, African Wildlife Foundation President Kaddu Sebunya says poaching hurts Africa as slave trade once did

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Ivorian Chocolate Makers Promote Locally-made Chocolatei
    X
    July 29, 2016 4:02 PM
    Ivory Coast is the world's top producer of cocoa but hardly any of it is processed into chocolate there. Instead, the cocoa is sent abroad to chocolate makers in Europe and elsewhere. This is a general problem throughout Africa – massive exports of raw materials but few finished goods. As Emilie Iob reports from Abidjan, several Ivorian entrepreneurs are working to change that formula - 100 percent Ivorian chocolate bar at a time.
    Video

    Video Ivorian Chocolate Makers Promote Locally-made Chocolate

    Ivory Coast is the world's top producer of cocoa but hardly any of it is processed into chocolate there. Instead, the cocoa is sent abroad to chocolate makers in Europe and elsewhere. This is a general problem throughout Africa – massive exports of raw materials but few finished goods. As Emilie Iob reports from Abidjan, several Ivorian entrepreneurs are working to change that formula - 100 percent Ivorian chocolate bar at a time.
    Video

    Video Tesla Opens Battery-Producing Gigafactory

    Two years after starting to produce electric cars, U.S. car maker Tesla Motors has opened the first part of its huge battery manufacturing plant, which will eventually cover more than a square kilometer. Situated close to Reno, Nevada, the so-called Gigafactory will eventually produce more lithium-ion batteries than were made worldwide in 2013. VOA's George Putic reports.
    Video

    Video Polio-affected Afghan Student Fulfilling Her Dreams in America

    Afghanistan is one of only two countries in the world where children still get infected by polio. The other is Pakistan. Mahbooba Akhtarzada who is from Afghanistan, was disabled by polio, but has managed to overcome the obstacles caused by this crippling disease. VOA's Zheela Nasari caught up with Akhtarzada and brings us this report narrated by Bronwyn Benito.
    Video

    Video Hillary Clinton Promises to Build a 'Better Tomorrow'

    Democratic presidential candidate Hillary Clinton urged voters Thursday not to give in to the politics of fear. She vowed to unite the country and move it forward if elected in November. Clinton formally accepted the Democratic Party's nomination at its national convention in Philadelphia. VOA national correspondent Jim Malone has more.
    Video

    Video Trump Tones Down Praise for Russia

    Republican presidential candidate Donald Trump is toning down his compliments for Russia and Vladimir Putin as such rhetoric got him in trouble recently. After calling on Russia to find 30.000 missing emails from rival Hillary Clinton, Trump told reporters he doesn't know Putin and never called him a great leader, just one who's better than President Barack Obama. Putin has welcomed Trump's overtures, but, as Zlatica Hoke reports, ordinary Russians say they are not putting much faith in Trump.
    Video

    Video Uganda Unveils its First Solar-powered Bus

    A solar-powered bus described by its Ugandan makers as the first in Africa has made its public debut. Kiira Motors' electric bus, Kayoola, displayed recently at a stadium in Uganda's capital. From Kampala, Maurice Magorane filed this report narrated by Salem Solomon.
    Video

    Video Silicon Valley: More Than A Place, It's a Culture

    Silicon Valley is a technology powerhouse and a place that companies such as Google, Facebook and Apple call home. It is a region in northern California that stretches from San Francisco to San Jose. But, more than that, it's known for its startup culture. VOA's Elizabeth Lee went inside one company to find out what it's like to work in a startup.
    Video

    Video Immigrant Delegate Marvels at Democratic Process

    It’s been a bitter and divisive election season – but first time Indian-American delegate Dr. Shashi Gupta headed to the Democratic National Convention with a sense of hope. VOA’s Katherine Gypson followed this immigrant with the love of U.S. politics all the way to Philadelphia.
    Video

    Video Dutch Entrepreneurs Turn Rainwater Into Beer

    June has been recorded as one of the wettest months in more than a century in many parts of Europe. To a group of entrepreneurs in Amsterdam the rain came as a blessing, as they used the extra water to brew beer. Serginho Roosblad has more to the story.
    Video

    Video Commerce Thrives on US-Mexico Border

    At the Democratic Convention in Philadelphia this week, the party’s presumptive presidential nominee, Hillary Clinton, is expected to attack proposals made by her opponent, Republican presidential nominee Donald Trump, to build a wall along the U.S.-Mexico border. Last Friday, President Barack Obama hosted his Mexican counterpart, President Enrique Peña Nieto, to underscore the good relations between the two countries. VOA’s Greg Flakus reports from Tucson.
    Video

    Video Film Helps Save Ethiopian Children Thought to be Cursed

    'Omo Child' looks at effort of African man to stop killings of ‘mingi’ children
    Video

    Video London’s Financial Crown at Risk as Rivals Eye Brexit Opportunities

    By most measures, London rivals New York as the only true global financial center. But Britain’s vote to leave the European Union – so-called ‘Brexit’ – means the city could lose its right to sell services tariff-free across the bloc, risking its position as Europe’s financial headquarters. Already some banks have said they may shift operations to the mainland. Henry Ridgwell reports from London.

    Special Report

    Adrift The Invisible African Diaspora

    World Currencies

    EUR
    USD
    0.8998
    JPY
    USD
    103.32
    GBP
    USD
    0.7594
    CAD
    USD
    1.3176
    INR
    USD
    66.954

    Rates may not be current.