MNI: ECB Praet Sees Convergence of Growth Rates in Euro Area

By Christian Vits

     FRANKFURT (MNI) - Economic growth rates in the Eurozone are converging at a

higher level than before and the recovery currently remains robust, European

Central Bank Chief Economist Peter Praet said Thursday.

     "The solid and broad-based economic recovery in the euro area is

continuing," Praet said in a speech in Brussels. 

     "We have now seen 18 quarters of positive growth and the short-term

economic indicators all point to a continued economic upswing with above-trend

growth," he added.

     Praet noted the breadth of the expansion and underlined that the dispersion

of growth rates across both countries and sectors is at its lowest level for two

decades, reflecting a "convergence of growth rates around higher levels."

     "This development is reassuring for the growth outlook as recoveries tend

to be firmer and more robust when they are broad-based," he added.

     Still, the solid economic recovery also offers a window of opportunity for

increased reform efforts, he stressed and namely pointed to potential growth,

which declined over the past two decades, and the elevated public-sector debt

ratio in the currency bloc.

     "Looking ahead, well-crafted reforms that combine growth with equity and

take account of the macroeconomic backdrop will be pivotal, both at national and

European level," Praet said.

--MNI Frankfurt Bureau; +49 69 97782671; email: christian.vits@marketnews.com

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