(Reuters) - The euro zone's public debt crisis is not over despite calmer financial markets this year, the OECD said on Tuesday, with a warning that the bloc's banks remain weak, debt levels are still rising and fiscal targets are far from assured.
As the euro zone heads into its second slump in just three years, the Organization for Economic Co-operation and Development (OECD) said the 17-nation area needed ambitious economic reforms and there could be no room for complacency.
"Market confidence in euro area sovereign debt is fragile," the Paris-based economic think tank said in a report on the state of the euro zone's health. "The outlook for growth is unusually uncertain and depends critically on the resolution of the sovereign debt crisis," it said.
In a departure from forecasts by the International Monetary Fund and the European Commission, the OECD sees 0.2 percent growth in the bloc in 2012, rather than an outright contraction.
While international economists are divided over just how deep any downturn will be this year, most agree that weak business confidence and budget austerity is eating into the purchasing power of European households, driving up unemployment and leaving Asian and U.S. demand holding the key to growth.
Read more: http://www.reuters.com/article/2012/03/27/us-eurozone-economy-oecd-idUSBRE82Q0EL20120327
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