Tags: Pimco | El-Erian | europe | contract

Europe to Contract as Much as 1.5%, Pimco's El-Erian Says

Wednesday, 13 Mar 2013 10:22 AM

Economic growth in Europe will probably contract 1 percent to 1.5 percent in the next 12 months with the private sector still starved of credit, according to Pacific Investment Management Co.’s Mohamed El-Erian.

Ireland’s first sale of 10-year government bonds since the nation’s 2010 bailout is a sign of the gradual healing in Europe’s financial sector, El-Erian, the chief executive officer of the world’s largest manager of bond funds, said in a “Bloomberg Surveillance” radio interview with Tom Keene.

Pimco’s recession forecast is deeper than the official European Central Bank estimate, which the central bank revised lower at last week’s policy meeting.

The ECB said the economy will contract 0.5 percent this year instead of the 0.3 percent projected three months ago, with ECB President Mario Draghi blaming an overhang from the bigger shrinkage in the final quarter of last year.

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Economic growth in Europe will probably contract 1 percent to 1.5 percent in the next 12 months with the private sector still starved of credit, according to Pacific Investment Management's Mohamed El-Erian.
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2013-22-13
Wednesday, 13 Mar 2013 10:22 AM
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