in Europe are growing at their weakest pace in two years, after a jump in credit
costs hurt banks. The decline follows a similar drop in manufacturing. Europeans''
confidence in the economy dropped to a 16-month low last month, according to a
28 September report.
credit market slump has added to pressures on European companies already battling
a record Euro and the highest crude oil prices ever. The economic slowdown may
spell the end of almost two years of interest-rate increases by the European Central
Bank (ECB), whose governing council meets on Thursday 4 October in Vienna.
Royal Bank of Scotland Group Plc has said its services index fell to 54.2, the
lowest since August 2005, from 58 in August. The index is based on a survey of
purchasing managers by NTC Economics Ltd, and a reading above 50 indicates expansion.
The figure is marginally higher than a 21 September estimate of 54.
will mean that the ECB will probably leave key rates unchanged. Pressure to make
a rate cut will rise over the next 12 months.
Bank, Germany''s biggest bank, said last month it would curb hiring and write down
the value of leveraged loans after suffering losses in the credit market. The
interest rate on inter-bank loans jumped in August, after European lenders revealed
losses in the US subprime mortgage market.
expansion in the UK was at its slowest pace in more than a year last month, a
report by the Chartered Institute of Purchasing and Supply has shown.
market losses have compounded the rising costs hitting the European economy. The
price of oil has gained 30 per cent this year, touching a record $83.90 last month.
On the other hand, the euro reached a record $1.4282, making European exports