Analysis: Big test to come when ECB raises rates

12/31/2009 | NYTimes.com

Speculation about whether Greece will default on its sovereign debt has raised doubt about the stability of the eurozone, but most European economists said the event is unlikely, or it will be manageable if it does happen. A bigger test awaits the eurozone when the European Central Bank decides to raise interest rates in response to improving conditions, particularly in Germany and France. That could intensify already-serious problems in Portugal, Ireland, Italy, Greece and Spain.

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