Merkel calls for integration to end euro crisis

Julian Harris
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GERMAN Chancellor Angela Merkel yesterday warned that the Eurozone is not out of the woods yet, and called on the troubled currency bloc to make a “quantum leap” in order to escape its economic crisis for good.

Warning of “deceptive calm” surrounding the Eurozone, Merkel used her state of the nation address to urge further European integration.

“Without decisive progress on this front, without a quantum leap, we won’t overcome the sovereign-debt crisis,” she said.

Merkel’s comments came after a widely-regarded survey showed consumer confidence in Germany at a six-year high, while economic data from other parts of the Eurozone painted a duller picture.

Morale among Italian manufacturers dropped unexpectedly for the first time in nine months in January, according to figures from the country’s official statistics body.

The Istat index for manufacturing fell to 97.7 from 98.2, it said. And while the index rose for services and retail trade, there was bearish news from nearby Spain. Spanish retail sales fell one per cent in December compared to a year earlier, its stats office said.

And across the Eurozone as a whole money supply growth slowed sharply in December, separate figures from Brussels revealed.

The monetary data also showed that loans to the private sector contracted further at the end of last year, putting pressure on the European Central Bank (ECB) to deliver more stimulus and counter the potential threat of deflation.