• External demand is weak and higher borrowing costs are dampening investments
• Consumers remain cautious on spending activity
• Inflation could slow noticeably at the start of the year, primarily on base effects

The stagnation and negative growth in the euro area economy continues into this year as any major recovery in growth conditions remain elusive. Germany might not be the sick man of the bloc now but it remains uninspiring at best. And the overall economic situation sure doesn’t look too promising to start the new year.

This article was written by Justin Low at www.forexlive.com.