As previously discussed, the recovery looks real to me, firmly supported by very high public sector deficits, and the implied support of the ECB which continues to stand by to fund the banking system as well as to buy national govt debt in the secondary markets as needed.
Yes, there are downside risks from external shocks and from future fiscal consolidation, but there are also offsetting upside risks to forecasts as well.
European Loan Growth Accelerated in June as Economy Recovered
EU Tests Get Positive Response From Finance Firms, BofA Says
Basel Committee Agrees New Bank Capital Rules
Germany Refuses to Sign Parts of New Basel Accord, WSJ Says
Germany warned of ‘big challenges’ ahead
German consumer confidence up strongly
Spanish Debt Costs Fall in First Auction Since Stress Tests