The European Commission predicted low inflation will remain a threat to euro-area expansion for at least the next two years as it trimmed its economic-growth forecast and warned of the impact of tensions with Russia.
Stocks fell, dragging U.S. and European benchmark indexes down from almost six-month highs, as talks over Greek debt restructuring reached a stalemate. The euro and commodities recovered from earlier declines.
The European Commission forecasts that Germany’s economy will grow 1.2 percent this year, compared with a 1.4 percent projection by the German government, Die Welt reported, citing Marco Buti , the commission’s head of economics.
The European Union asked Hungary to modify a law that cut the salary of Central Bank President Andras Simor , Index reported, citing a letter from Marco Buti , head of the European Commission’s economics department.
The euro gained for a fifth day against the dollar, the longest streak in three months, after European Union Economic and Monetary Affairs Commissioner Olli Rehn said Greece was “close” to reaching agreement with its creditors.
European nations including Italy, Belgium and Spain may sell more than 33 billion euros ($43.3 billion) of securities this week as credit-rating cuts risk upending optimism the region’s debt crisis is being contained.