Economy’s Crisis Respite Gives ECB Room to Pause Rate Cuts

The European economy may be winning some respite from its sovereign debt crisis.

With the euro area teetering on the brink of a second recession in three years, data this week showed rebounds in German exports and French business confidence, suggesting the slowdown may be limited. The euro’s 10 percent drop against the dollar since late October and an easing of financial conditions may also provide support as leaders fight to restore investor faith in their region’s bond markets.