Economists said today they expect the euro zone to carry on growing into next year, albeit anemically, backing a chorus of senior figures in the bloc who have insisted it is set to avoid recession.
Many economists believe the United States is already in recession and markets had feared the euro zone would inevitably follow suit, starved of US export business and burdened with relatively high real interest rates.
But officials asserted this week that the 12-nation euro zone would escape the worst of the downturn.
And a Reuterspoll of economists showed that most expect the the eurozone to avoid a significant economic contraction.
French data today underlined the risks to growth.
An official survey of more than 2,000 companies, carried out in October, showed they planned to cut industrial investment by four per cent in 2002 in response to the collapse in demand, exacerbated by the September 11 attacks on US cities.
But economists expect intensive interest rate cuts in the United States to reinvigorate the US economy before it drags the euro zone behind it into recession.
And further cautious easing by the European Central Bank will also help the euro zone economy to avoid contraction, they say.
"Growth is going to grind to a halt over the next six months, but...we do expect a sharp rebound in activity in the second half of next year as the large amount of monetary and fiscal loosening around the world takes effect," said James Carrick at ABN Amro in London.
"We do see a rebound in the US and that will drag the rest of the global economy along with it," he added.