Quantcast

Summary Box: Europe central bank looks for growth

Associated Press

Published: Tuesday, April 3 2012 1:20 p.m. MDT

FILE - The March 7, 2012 file photo shows a shovel and a jackhammer stand near the Euro sculpture in front of the European Central Bank in Frankfurt, Germany. Europe is searching for a growth motor. Unemployment and manufacturing figures on Monday, April 2, 2012 underlined an increasingly shaky growth story, as a key index of industrial activity strongly suggested Europe is already in an official recession after shrinking 0.2 percent in the last three months of 2011.

Michael Probst, file, Associated Press

Enlarge photo»

ANYONE GOT AN IDEA?: Europe is searching for something to get growth going again and pull the eurozone's heavily indebted countries out of their troubles — but with little luck.

THE PROBLEM: Unemployment and manufacturing indicators suggest the 17 countries that use the euro are headed for an official recession. But many traditional tools to stimulate growth — government spending, tax cuts and lower central bank interest rates — are off the table.

THE OUTLOOK: Short-term answers are scarce. The debt crisis hitting the eurozone means governments can no longer spend their way out of a downturn. They are making austerity cuts. Structural reforms could help but may take years to show results.