Eurozone growth past peak.

The economic growth in the eurozone is past his peak said the European Commission. Due to financial market turmoil and a weak French performance.

The European Commission estimated a 2,6 percent grow in the eurozone, but at the end it was a growth of 2,5 percent. The growth in the European Union is 2,9 percent.

These results are a bit disappointed because last year the Eurozone had got the fastest growth since the turn of the decade with 2,8 percent and the European Union had 3,0 percent.

The biggest reason for the disappointed results is France. France is the second biggest eurozone economy. The European Commission estimated a growth from 2,4 percent for France, but at the end it was only 1,9 percent.

They warned that chaos on financial market could spill over to the real economy if a slowdown in the United States proves to be worse than expected or if credit conditions for business and consumers worsen sharply.

They expected that the European economy can remain strong thanks to the confident of the consumers, with unemployment falling to levels not seen in Europe since the early 1980s.

Source

(Tom Van thienen)

Expensive oil makes travelling more expensive.

The price of oil has reached a new record this week, which is a signal for Air France to raise their prices, more exactly the fuel adjudication. The price will raise with one euro if you travel in Europe, and with 5 euro when you take an intercontinental flight.
Brussels airlines, the belgian fly company will not raise their fuel adjudication yet, but they admit that if the situation stays like it is, they will have to intervene. They are following the situation closely.
Ryanair still doesn’t ask a fuel adjudication, but they sometimes change their prices for other services, like luggage, to keep good results.

The fuel adjudication encourages the travel agencies to raise the price for a journey. For the summer holidays, the travel agencies have already asked a fuel adjudication at their customers. Because their is a chance that they will have to pay more to fly compagnies in the future, they have also raised the brochure prises for the spring holidays, so they are armed against the oil price in spring. The travel agancies said that they won’t ask a fuel adjudication on top of the brochure prices for the spring holidays.

This article shows us that we are to dependent to oil, and that the oil price has a large effect at the European economy.

Source: klik

Northern Rock goes bankrupt

A few weeks ago, the news arrived that a bank in the United Kingdom had some financial problems. But nobody had thought that the problems with ‘Northern Rock’ were so big.

The bank had not enough money to help all the people so it lent 3 billion British Pound at The Bank of England. That is about 4,3 million Euro.
The past week everybody who has a bank account at Northern Rock started to worry.
Almost everyone reacted the same, they started to take their money of the bank account. This reaction is the end for Northern Rock.

According to the ‘Financial Times’ the 3 billion British Pound is equal to 10% of the bank accounts. The Prime minister of the United Kingdom wants that the government create the same system as in the United States of America. There, all the bank accounts are protected against a bankruptcy. Meanwhile the government has promised to pay for all the bank accounts, so nobody will lose their money.

My opinion about this: I thought that in the economical en political system of today it was impossible that a bank goes bankrupt. Especially a bank in Europe, where they have al those control organisations. Last year we have seen that it was almost impossible that a big bank goes bankrupt. Because there are so many controls to see of everything is still ok.

Source: Tijd.be
(Bram)

Euro vs Dollar

On Thursday the euro closed in on 1.41 dollars!

(To be precise: 1.4090 dollars.)

That’s more than the previous record for the European currency, that’s because of the cuts in the interest rates in the US. In the US the interest rates stand at 4.75 percent now while in the Eurozone the rates are at 4.0 percent. This reduction in interest rates makes it much interesting to invest in the Euro in comparison with all the other currencies!

The dollar became cheaper for investors using other currencies that causes much fear about inflation fuelled by record oil prices.

Over the next few months the believe that the markets will start to speculate that US interest rates will actually fall below those in the Eurozone
Analysts forecast that the Dollar will lose more in 2008, some suggesting the euro could rise to 1.50 dollars.

And what is also new after 27 years: the price of gold is surged, striking 738.60 dollars to reach its highest level.

Like I just said the Euro is increases at 1.4090 dollars, but also the other currencies decreases in comparison with the yen (162.01), the pounds (0.6975) and the Swiss francs (1.6528).

(Keep in mind that all this values are those at this particular moment, and when you read this it can be modified!)

So this means that we will receive much more investors from other countries in the future, we’ll see what that will bring us!

Source

(Jonas)