The Euro zone debt crisis is aggravating the condition of Britain’s already lagging economy. Financial experts are of the opinion that the Euro zone must embark the biting reforms to manage its public finances. Although doing such changes may undermine the sluggish economy, yet the Organization for Economic Cooperation and Development has warned the Euro zone of the imminent danger. With the over-spending continuing among the Brits, the number of people who are resorting to Christian debt consolidation services are also increasing.
The consumer debt crisis in Europe is derailing the recovery of Britain’s economy. An eminent person has reportedly said that there was a strong mark of recovery of the Euro zone and Britain but still there were some challenges that are still prevailing. He has also added that if this debt crisis that has plagued Ireland and Greece, the monetary policy of the Bank of Europe that has set interest rates will also drag Britain into the debt mire. If the debt level intensifies in Europe, it will also facilitate a blow to the recovery of the Euro zone.
How does the financial behavior of the Brits affect the debt crisis?
According to a recent survey, more than half of the Brits are struggling under huge amount of credit card debts and unsecured loans. With the Christmas knocking at the doors, there is a huge increase in the amount of dollars spent by parents and students. Reports show no change in the financial behavior of the Brits despite the economic downturn that is also affecting the Euro zone debt crisis. Parents will spend an average amount of 2 billion pounds on Christmas in spite of the fact that 30% of the Brits feel that they are under more financial and economic pressure of meeting their financial obligations. The debt experts have advised the Brits to bring their spending under control in order to help the economy to recover.
Why does the Euro zone need to rebalance its economy?
The OECD or the Organization for Economic Cooperation and Development has warned the Euro zone to rebalance its economy. An eminent financial spokesperson has said that fiscal consolidation is necessary to help the Britain’s economy to rejuvenate, although there may be a drag on of the growth till a shorter term. According to the latest reports the current debt crisis in the British economy has pushed the borrowing costs to a record high level and has also threatened the solvency of the country.
Therefore, to bring the economic depression under control, OECD has advised the economies to rebalance their public spending. Though this is a tough decision for the big importers as the wages and prices will all be adjusted to shift the concentration of resources.