Yesterday, Angela Merkel painted a rather gloomy picture of next year’s economic outlook.
In a televised New Year speech to the German population Merkel commented that in 2013 the economic environment will be even more difficult than it has been in 2012 (and it’s hardly been a bed of roses this year).
Merkel asserted that despite the strides towards recovery taken this year the financial situation in the Eurozone is not set to improve any time soon.
She stated: ‘The reforms that we’ve agreed on are starting to take effect. Nevertheless, we still need a lot of patience. The crisis is far from over’.
Merkel continued: ‘For our prosperity and our cohesion, we need the right balance. We need the willingness to perform and social security for all. The European sovereign debt crisis shows how important this balance is.’
Jens Weidmann, president of the German Central Bank, expressed similar sentiments in a published statement yesterday.
The Bundesbank leader was quoted as saying: ‘The crisis seems to have calmed down at the moment. There is progress in reforms.’
However, he then added that ‘Far from all the causes [of the crisis] have been eliminated.’
Christmas-festivity-inspired boredom could have played a part in this bout of pessimism, but with the fiscal cliff situation in the US and the continuing monetary issues dragging at many prominent Eurozone nations it does seem that we must prepare ourselves for another long year of economic difficulty.
As of 12:15 pm
The Pound to Euro exchange rate is currently trading at 1.2262
The Pound to US Dollar exchange rate is currently trading at 1.6170
The Pound to Australian Dollar exchange rate is currently trading at 1.5593
The Euro to US Dollar exchange rate is currently trading at 1.3183
The Euro to Pound exchange rate is currently trading at 0.8152
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