EC slashes eurozone growth forecast

The European Commission has slashed its eurozone growth forecast for next year.

After earlier projecting an economic growth rate of 1.8% in 2012, The Commission now forecasts a growth rate of just 0.5% in 2012.

The level for this year has also been cut from 1.6% to 1.5%.

The news prompted a gloomy response from Europe's Economic Affairs Commissioner Olli Rehn who said today's forecast is the "last wake-up call".

He warned the recovery had stalled and there was a "risk of a new recession" unless determined action is taken.