EU's Almunia Expects Gradual Rise in Demand to Boost Recovery
European Monetary Affairs Commissioner Joaquin Almunia said he expects a gradual rise in domestic demand to boost recovery in the European Union economy next year, helped by ``accommodative'' macroeconomic policy and a ``robust'' global environment. "Although economic activity in the euro area and the EU has been more subdued this year than projected in the spring, it is expected to return to potential at the beginning of next year,'' Almunia said today at the European Policy Forum in London. ``The recovery is supported by an acceleration in domestic demand.''
European Central Bank President Jean-Claude Trichet said Nov. 21 that the bank was ``ready to moderately augment'' the benchmark rate of 2 percent to contain inflation. Almunia said he expects growth to reach 1.9 percent in the euro area and 2.1 percent in the EU in 2006, and to accelerate a further 2.1 percent in the euro area and 2.4 percent in the EU in 2007.
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