Euro Leaders Will Try to Secure Recovery after Strong Data Coming from France and Germany
On Friday, European leaders agreed on new steps to fight youth unemployment and promote lending to SMEs.
European leaders agreed to deploy €8 billion (up from €6 billion) to create jobs for young people and frontload the initiative for the next two years, starting from January 2014:
More from China Daily:
Top leaders of the European Union (EU) have agreed on an 8-billion-euro youth employment initiative, aimed at solving the urgent issue of youth unemployment as well as boosting small and medium-sized enterprises.
EU leaders, who are here attending a two-day summit, decided to scale up the funding for the initiative from 6 billion to 8 billion euros and “frontload” the initiative for the next two instead of seven years, starting from January 2014, European Council President Herman Van Rompuy said at a press conference in the wee hours of Friday.
Many EU member states would count on the initiative to help provide a job, training or apprenticeship to young people within four months after leaving school or becoming jobless.
Leaders also approved plans for the European Investment Bank to lend hundreds of billions of euros to small and medium-sized enterprises (SMEs) particularly in southern EU states. The communique urges the EIB to implement its plan to increase its lending activity in the EU by 50% (€150 billion) over 2013-2015.
More from Kathimerini:
According to a draft of the summit’s conclusions seen by Kathimerini, European leaders are to invite the EIB to accelerate procedures for the provision of 150 billion euros in the form of loans to European economies over the next two years. Of these funds, 100 billion euros would go toward funding SMEs.
At the same time data coming from France and Germany showed a rebound in domestic consumption in May and suggest that European growth could stabilize in Q2:
More from Reuters:
French consumers spent significantly more than economists had expected in May despite concerns about surging unemployment, data showed on Friday, rekindling some hopes that France might be slowly emerging from recession.
However, although the risk of prolonged recession may be receding, activity remains far too weak in the euro zone’s second-biggest economy for a rapid recovery, economists said.
The INSEE statistics agency reported that household spending rose 0.5 percent over the month, beating by a wide margin the average forecast given by economists of a 0.1 percent fall.
More from Bloomberg:
German retail sales rose more than economists forecast in May, adding to signs that a recovery in Europe’s largest economy has gathered pace amid record-low interest rates, while inflation accelerated.
Sales adjusted for inflation and seasonal swings climbed 0.8 percent from April, when they fell 0.1 percent, less than originally estimated, the Federal Statistics Office in Wiesbaden said today. Economists had predicted a May increase of 0.4 percent, according to the median of 23 forecasts in a Bloomberg News survey. The consumer price index rose more than forecast, climbing 1.9 percent this month, separate data showed.