For businesses, there is still a further risk of deflation affecting their profit margins. During the month of June, according to data from Eurostat, the euro zone showed the first annual price deflation (which was 0.1%), since the introduction of the euro. The logic of the entrepreneur who sees an economy that is contracting and that their margins are also shrinking caused by low prices, tends to consider that this is not a year to invest, or if there doing so, better to opt for short-term alternatives. With this way of thinking to understand European business, it creates a vicious circle that deepens the economic downturn in the euro zone. It is wrong, but so good (Carlos Saul Menem, during his presidency in Argentina, 1990).
This sentence clearly reflects the situation of the euro zone economy. In this regard, an encouraging sign for the industry was, as he realized a week ago expansion, which in May reported its first monthly increase since August 2008, beyond on-year the industry saw a 17% contraction during that month. The growth in the month is a sign that increases the hope of recovery industry in the euro area. Industrial production accounts for about 17% of GDP in the euro area and therein lies its importance in terms of the way out of recession. The way out of this recession and recovery Eurozone industry, is highly dependent on what happens in the U.S. economy. Families and businesses are not too strengthened to boost domestic demand and hence economic growth.