Europe’s stock markets stumbled again on Tuesday reflecting a comment from the European Commission President, Jose Manuel Barroso who said: “Day by day, the evidence builds that we are facing a serious economic slowdown.”
Investors have seen that in disappointing company results and even efforts by the French government to bolster the country’s banks had only a limited effect.
The feeling is more will have to be done to lessen the recession.
Howard Wheeldon, Senior strategist BGC Partners said: “The authorities, governments and central banks, will continue to pump in money and or to cut interest rates or indeed put in fiscal plans such as tax cuts to help push us into a shorter and shallower recession than many of us have feared.”
Meanwhile, the euro has fallen to its lowest in over a year and a half against the dollar.
The US currency is still in demand by banks for their lending needs, despite signs that the efforts to thaw the credit freeze are starting to work.