While Greece is close to getting a helping hand, other economies in the European Union are still struggling. While Italy and its exchange traded fund (ETF) are forecast for stronger growth this year, the country is still grappling with high unemployment and a big fiscal deficit.
Italy’s economy has been forecast to grow 1% this year on the back of stronger exports, Lorenzo Totaro and Flavia Krause-Jackson for Bloomberg report. That beats the previous forecast of 0.6% growth. Consumer spending is also forecast to increase 0.8% this year and 1.1% in 2011; exports may grow 3.8% this year and 3.9% next year.
Christopher Amsden for The Wall Street Journal explains that derivative contracts taken out by Italian municipalities could harm local public finances for decades, as debts and imbalances may magnify over time.
Italy used a currency swap to help its application to join Europe’s monetary union at its birth more than a decade ago, and this is the same situation that Greece is going through.