The Euro 750 billion package, assembled by the European Union and the International Monetary Fund, the austerity plans as well as the results of the European banking sector stress tests which indicated that the banking sector was in better shape than feared, appeased some of the worst fears and restored some calm on nervous markets.
As I write this Statement, the world economy is showing visible signs of recovery, with greater momentum coming from emerging-market economies. The exceptional stimulus from monetary and fiscal policies continues to prop up economic activity. There is growing concern that the recovery in the major advanced economies may stall as balance sheets are adjusted and the stimulus packages gradually withdrawn.