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The U.S. Federal Reserve may have slashed the Fed funds rate as low as humanly possible. After all, how can you beat zero percent (actually targeted 0.00% to 0.25%)? The answer is with quantitative easing and endless bond buying, but that is another story entirely. A rate cut by the Europe Central Bank (ECB) is becoming increasingly likely, if you just read the economic data.

Data from last week showed that inflation is well under the target. That is true in the United States as well. What is different is that even some of the worst troubles in Europe may be finally reversing. Imagine that, factory activity has risen in Spain. In Italy as well.

The euro had recovered from a significant decline against the U.S. dollar to $1.28 twice so far in 2013. This most recent recovery took the price of a euro back up to $1.38. It seems that the Europeans believe this was too large of a move in only about 90 days. Now the euro is back around $1.35 on hopes of a rate cut by the ECB.

The markets may not be demanding a rate cut by the ECB this week, but the expectation for a rate cut in December seems to be growing. Even in late October, the ECB said that the annual growth rate of the broad monetary aggregate fell to 2.1% in September 2013 from 2.3% in August 2013. Here are just a few other things to consider about Europe.

National Bank of Greece S.A. (NYSE: NBG) has now seen its U.S.-listed ADRs double off their lows of July. Greece’s top bank is even seeing its ADRs challenge highs not seen since June. Shares still remain down close to 75% from the highs of the last year.

In Spain, we recently saw Bill Gates invest in a building and infrastructure company. This seemed odd if you only read the media headlines. But think about Spanish banks. The New York-listed ADRs of Banco Santander S.A. (NYSE: SAN) and Banco Bilbao Vizcaya Argentaria S.A. (NYSE: BBVA) rallied sharply after mid-July with gains of 50% on average, before recent profit taking.

Telecom Italia SpA (NYSE: TI) has been bolstered by unit sale news. Its shares rallied close to 60% in two months, before recent profit taking. If that is possible in Italy, why not elsewhere in troubled European countries?

Even the shares of Portugal Telecom SGPS S.A. (NYSE: PT) managed to recover almost 40% in less than two months, before recent profit taking. It remains one of the few ways that American investors can position themselves for any investing into Portugal.

And the Bank of Ireland (NYSE: IRE) ADRs have had a miracle recovery as well. Its shares have recovered almost 200% from the lows of the last year. It is also up about 116% so far in 2013. Ireland keeps trying to deliver on getting rid of the bad assets and pay down on the sins of its pre-meltdown past.

On a broader basis, the Vanguard FTSE Europe ETF (NYSEMKT: VGK) has recovered handily. This European broad market stock exchange traded fund has recovered some 20% or so from the lows of the summer and is up 19% so far in 2013.

If Europe can keep its inflation under wraps, it seems that the ECB bankers might just think that fostering growth is finally a good thing.

The real question is whether Europe wants to go down the same path as the United States. The fixed level overnight refinancing rate of 0.50% is at its lows, and there is not much lower that it can go before Europe has to take on draconian easing measures as well.