As a result, private investment is predicted to grow by 14%, close to pre-crisis levels, whereas ratio of investment to GDP is forecasted to rise from 19% to 23%. Government consumption growth is predicted to be slower, in line with government efforts to reduce its deficit to GDP ratio.
The ECB, in collaboration with the BSC (national central banks and supervisors), carried out a survey of EU banks’ exposures to hedge funds, which has been published and is now available on the ECB’s website. The December 2005 Financial Stability Review contains a box summarising the key findings of the survey.