The European Central Bank (ECB) has reduced its eurozone growth forecast and kept interest rates the same.
It now expects the eurozone to contract by 0.6 per cent this year, having earlier predicted a gross domestic product reduction of 0.5 per cent.
ECB president Mario Draghi said at a press conference the recovery would start in 2014 but admitted the bank still saw "downside risks" for the economy.
"They include the possibility of weaker than expected domestic and global demand and slow or insufficient implementation of structural reforms in euro area countries," he said.
However, the bank also marginally revised up its 2014 forecast to 1.1 per cent growth.
Export growth was given as a main factor in the forecast as a recovery in global demand should give the sector a boost.
The benchmark interest rate was kept at 0.5 per cent, after being cut from 0.75 per cent in May.
By Tony Aynsley