AS large parts of Europe’s economy grind almost to a halt, attention will focus this week on the latest assessments of business confidence in the eurozone and Germany, which has just narrowly avoided a recession.

    While the United States economy has accelerated and China holds a slower but steady course, eurozone countries have remained sluggish, with overall growth in output slowing to a trickle.

    “The eurozone is the best part of 20 percent of the global economy,” James Knightley, an economist with ING, said. “The longer the stagnation goes on the more Japan-like it becomes.”

    The eurozone’s problems have raised expectations that the European Central Bank is preparing to loosen its purse strings further to try to rekindle growth.

    Against this backdrop, Germany’s Center for European Economic Research’s (ZEW) monthly barometer of sentiment, due today, will provide more insight into business confidence levels.

    The Ukraine crisis is a major drag on business and investor sentiment, especially as there have been new reports of Russian troops pouring into eastern Ukraine.

    German Chancellor Angela Merkel said at the G20 leaders’ summit Saturday in Brisbane that the European Union was considering further financial sanctions against Russian individuals because of the crisis.

    Fallout from the Ukraine conflict is exacerbating the eurozone’s problems, with European sanctions squeezing Russia’s banks and companies and having knock-on effects particularly on Germany.

    A company purchasing managers’ survey Thursday will offer a snapshot of whether companies are expanding in Germany, France and across the eurozone.

    That follows new monthly information on international trade, due out today, which will show the extent of falls in exports to Russia.

    The bleak picture in Europe contrasts with brighter prospects for the United States, where an update on the how the country’s manufacturers are faring is also out Monday.

    As the U.S. economy picks up, its central bank is moving closer to raising the cost of borrowing for the first time in more than eight years.

    Later in the week, economists will pore over the minutes of the Federal Reserve’s latest policy meeting for any hints as to when Fed Chair Janet Yellen will begin reining in cheap money.

    (SD-Agencies)