European monetary policy suits all but ailing Germany

Although Germany remains a major concern, the eurozone as a whole is probably experiencing nothing worse than a growth pause, according to Richard Reid of SchroderSalomonSmith Barney. Reid said the problem is in finding the catalyst that will end the pause, particularly as US demand growth is likely to be modest for the next couple of quarters. Further difficulty comes from the fact that fiscal policy is handicapped by high deficits in the larger eurozone economies and by the constraints imposed by the Stability Pact. Reid said: 'One problem for the European Central Bank (ECB) is th...