Eurozone recovery on track as growth rises

Violet Tucker
August 1, 2017

In the previous quarter, growth was revised down however, from 0.6% to 0.5%.

The eurozone economy has grown twice as fast as the United Kingdom in recent months, according to official figures that underscore the divergence between Britain and its neighbouring currency bloc after the Brexit vote.

On Friday, figures showed Spain's economy, one of the worst-hit by the financial crisis, grew by 0.9% in the second quarter, suggesting the country's economy had finally grown back to the size it was before 2008.

A forecast expansion of 0.6 percent in the April-June period, equivalent to an annualized 2.4 percent, would be the third consecutive quarter in which the euro zone has grown at or above a half percentage point, for the first time since 2007-08.

On a yearly basis, growth accelerated to 2.1 percent from 1.9 percent a quarter ago.

This is the lowest rate recorded in the euro area since February 2009, according to figures from Eurostat, the statistical body of the European Union.

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The agency will release updated estimates of eurozone GDP growth on August 16 with final data to come on September 7.

The data reinforces the view that the Eurozone economy continues to gain momentum after more than two years of massive asset purchases by the European Central Bank and nearly a year and a half of negative interest rates. The manufacturing PMI for the Eurozone is due at 4:00 am ET.

The pound was boosted after data showing that United Kingdom factory growth rebounded in July on the back of a surge in new exports.

Today's data is yet another sign that the Eurozone is going from strength to strength this year, with the bloc's economic recovery picking up the pace in recent months.

"Although the exchange rate remains a key driver of export growth, manufacturers also benefitted from stronger economic growth in key markets in the euro area, North America and Asia-Pacific regions", Dobson said.

Other reports by Guamnewswatch

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