Eurozone on the brink as macron issues major economic warning

French President Emmanuel Macron has warned the EU that it needs a huge shift in its economic approach to avoid falling behind the US and China. He said the EU has three to four years to

correct course or the damage could be irreversible. Mr Macron made the comments at the Berlin Global Dialogue. The French President said: “If we continue with our old growth model, we will

be uncompetitive in three or four years." He added that the EU needs to “wake up” before warning: “I truly believe that we are in danger." _HOW CAN THE EU COMPETE WITH AMERICA AND

CHINA? HOW DO YOU SEE THE NEXT FOUR YEARS PLAYING OUT? HAVE YOUR SAY IN OUR COMMENTS SECTION._ He added: "The EU could die, we are on the verge of a very important moment. "Our

former model is over – we are over-regulating and under-investing. In the two to three years to come, if we follow our classical agenda we will be out of the market" The Eurozone was

handed a huge boost this week as expected inflation in September fell below the two percent target set by the European Central Bank (ECB). Inflation is now thought to be at 1.8 percent,

meaning interest rates could be slashed. The ECB warned however that it does not want inflation to drop too low. They said: "We view inflation that is too low just as negatively as

inflation that is too high." Matthew Ryan, head of market strategy at Ebury, has predicted that the ECB will now be "forced" to cut rates. He said: “While President

(Christine) Lagarde indicated to markets at the last meeting that an October cut was not in the bank’s baseline scenario, we think that macroeconomic data since then is highly likely to

force the bank’s hand. "Not only is inflation continuing to come down nicely, but the Euro Area economy appears to have practically stagnated in the third quarter of the year, at least

according to last week’s dismal set of business activity PMI figures. “We see another 25 basis point cut as set in stone this month, with Lagarde likely to both express greater confidence on

inflation and warn over the state of the bloc’s economy. This would likely tee up a third straight rate reduction at the bank’s December meeting, which is now fully priced in by swap

markets following today’s data.”