Tuesday March 17, 10:39 AM
CORRECTED-UPDATE 1-EU'S Almunia sees signs of improvement-report
MILAN, March 17 (Reuters) - There are better signals for economies than three months ago, European Economic and Monetary Affairs Commissioner Joaquin Almunia told Italy's La Stampa newspaper in an interview published on Tuesday.
'Some banks have announced results above expectations, the liquidity market is working better and government commitments to public spending are starting to bear fruit,' he told the newspaper.
Britain's Barclays (LSE: BARC.L - news) on Monday joined U.S. peers Citigroup (NYSE: C - news) , Bank of America (NYSE: IKJ - news) and JPMorgan Chase with an upbeat outlook, saying business was off to a good start this year.
But Almunia added that as government measures to support economies swell deficits, 'the margins for manoeuvre are disappearing even for those who had them.'
He said the impact of support for banks had been particularly marked in Britain and Ireland, whereas in Spain, it had been lower. In Italy, banks had 'fortunately not needed huge interventions. There haven't been problems so far.'
Banco Popolare (Milan: BP.MI - news) is the only Italian bank so far to say it will take advantage of government support in the form of backing for bond issues although other leading banks are expected to announce similar plans in the next couple of weeks.
Almunia said governments needed to take action on unemployment as a first step, 'but that doesn't mean the European Commission should not work on the framework.'
'There are tensions everywhere,' he added.
Almunia said 'all the forecasts suggest falling growth in Europe this year and a very uncertain situation in the driving sectors of the economy, such as industrial manufacturing, construction, services.'
'For concrete results, we need a solid social dialogue,' Almunia said.
(Reporting by Jo Winterbottom; Editing by Neil Fullick) Keywords: ALMUNIA REPORT/
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