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2012-03-22 10:11:01
European Central Bank President Mario Draghi has said the worst of the eurozone
crisis is over.
In an interview with Germany's Bild newspaper, he said the situation in Europe
was "stabilising".
Mr Draghi also said that some economic data, including inflation and budget
deficits, showed that Europe was doing better than the United States.
But the latest surveys of purchasing managers, released on Thursday, suggest
European economies could be flagging.
The Purchasing Managers Indexes (PMI) survey thousands of companies and
indicate whether business is expanding or contracting.
The figures for Europe's most important economy, Germany, show that
manufacturing activity shrank in March and new orders fell at the fastest pace
so far this year.
That contributed to a sharp downturn for the whole eurozone, with the PMI index
showing that business conditions deteriorated further in March.
"It's going to be a very poor-looking year at this rate," said Chris
Williamson, chief economist at Markit, the company which compiles the PMI
surveys.
"We had an uplift at the start of the year, which we hoped was the economy
regaining momentum, but it seems to be losing its legs."
The European Central Bank chief Mario Draghi is credited with having deflected
a much more serious crisis by lending European banks large sums at very low
interest rates.
Over two rounds, one in December and one in February, the Long Term Refinancing
Operation injected more than half a trillion euros of new funds into European
banks.
In his interview with Bild, Mr Draghi said: "Last autumn, the situation was
really critical. It could have come to a dangerous credit crunch for the banks.
"As a result, businesses could have gone bankrupt, because they would have been
left high and dry. We had to prevent that."
It may be significant that he chose to speak to Bild, Germany's most popular
newspaper. Mr Draghi, an Italian, has been portrayed in Germany as too loose
with ECB money, in contrast to the more fiscally austere German way
image of Stephen Evans Stephen Evans BBC News, Berlin