The Mystery of the Eurozone Slowdown

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The global economy entered 2018 apparently locked in a period of strong and synchronised growth, with all of the major geographical blocs breaking free of the constraints that had dogged previous growth spurts since 2010, the Financial Times reported in a commentary. While that may still be the case, optimism has been dented by a sudden and rather sharp downturn in activity in the eurozone, a region that had until recently been leading the global expansion. This started in February and has now become an event of sufficient importance to warrant further investigation, since the causes of such a large setback to growth in a large part of the global economy are not entirely clear. Last year, the eurozone surprised economic forecasters in entirely the opposite direction. After a long period in which the ECB had failed to ease monetary conditions in the face of the zero lower bound on interest rates, unconventional monetary easing finally gained traction in 2017. Read more. (Subscription required.)