The European Commission cut its forecast for the euro-area economy to show a contraction twice as deep as it projected just three months ago, and said the regionâs deficit will swell to more than double the European Union limit.
The economy of the 16 countries sharing the euro will shrink 4 percent in 2009 and 0.1 percent in 2010, the Brussels- based commission, the European Unionâs executive, said today, revising a January estimate for a contraction of 1.9 percent this year. The regionâs average budget deficit will swell to 6.5 percent of output next year, when unemployment will rise to 11.5 percent, the commission said.
