12 July 2005, 12:18  Joaquin Almunia: Second-half economic growth in the euro zone could top first-half growth

Second-half economic growth in the euro zone could top first-half growth, European Union Commissioner for Monetary Affairs Joaquin Almunia said Tuesday. Almunia also said, "I would like to see oil prices come down." Due largely to high oil prices, which recently topped $60, euro-zone economic activity has slowed to a point where Almunia gave a pessimistic assessment of the single-currency area's third-quarter prospects. Speaking to reporters late Monday, he said third-quarter growth was likely to come in below the 0.5% first-quarter rate. His Tuesday comments signal he's not completely downbeat on the region's economic prospects, implying euro-zone growth will pick up in the fourth quarter. The rise in oil price has come as the euro has slumped to under $1.20, not a good thing for the export-oriented, oil-imporing euro zone. The euro spent most of last year closer to $1.30, so the falling euro makes European exports more attractive to those buying with dollars. But these days, oil - sold in dollars on international markets - costs Europeans relatively more than last year because of the euro's slump.

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