Nouriel Roubini, co-founder of Roubini Global Economics LLC, said the debt crisis in the euro area is increasingly affecting the currency bloc’s biggest economies, Germany and France.
“The economic contraction used to be in the periphery of the euro zone,” Roubini said in a speech in Mainz, Germany, today. “It is spreading now to the core of the euro zone. For example, it is quite clear that France is entering a recession.”
Referring to Germany, the region’s biggest economy, Roubini said “there is evidence of an economic slowdown” caused by lower demand for the country’s exports from its euro-area partners and China. Third-quarter gross domestic product data for Germany, France and the euro area will be released tomorrow.
Roubini said it is “very positive” for the 17-nation euro area that the “European Central Bank has now taken a more active role.” The announcement of its unlimited bond-buying program “significantly reduced” the risk of a breakup of the common currency, he said.