Euro zone recovery likely to gain momentum in 2016 and 2017

Heading into 2016, weak commodity prices, low inflation and strong Euro will put the deflationary pressure on Euro zone economy. In addition, global headwinds and the ongoing deterioration of many major emerging economies has increased the likelihood that the ECB will undertake more monetary stimulus in the form of another cut to its deposit rate and an increase in the volume of monthly asset purchases as early as its next meeting in March.   

The gradual recovery was observed in 2015 and has been mainly supported by domestic demand. The region's growth is also expected to continue to maintain momentum in 2016, aided by solid domestic demand, low oil prices and the continuation of an accommodative monetary policy. Looking forward, the Euro zone economy is expected to maintain the pace of growth in 2017. 

According to Scotiabank, "The euro zone recovery is expected to continue to gain momentum, with real GDP growth rising to 1.7% in 2016 and 1.8% in 2017, up from 1.5% last year".