The European Union's statistics office reported that GDP rose 0.3% in the first quarter of 2024 in both the euro area and EU regions.
BRUSSELS, Oct 30 (Xinhua) — Eurostat's provisional data released on the 30th showed that the euro area and European Union (EU) region's seasonally adjusted GDP increased by 0.3% in the second quarter of 2024 from the previous quarter.
GDP also grew 0.3% in both regions in the first quarter of 2024, the European Union's statistics office reported.
According to Eurostat data, Germany's output fell by 0.1% in the second quarter. France and Spain recorded growth of 0.3% and 0.8% respectively. The highest growth rate was in Ireland, which recorded an increase of 1.2% in the second quarter. Conversely, Latvia recorded a notable decrease of -1.1%, while Sweden and Hungary also recorded negative growth.
Bert Collin, senior economist at ING, said the euro zone economy grew at a faster pace than expected in the second quarter, but the recovery remains cautious, supported by low unemployment and falling inflation, and there are no signs of a further acceleration in euro zone growth.
“Differences within the euro area remain stark,” Collin said, noting that Spain remains the euro zone's growth engine while France also looked stronger than expected in the second quarter, but that this was mainly due to a temporary export hit.
“Germany remains the weak link in the post-pandemic economy and its overall performance would be weaker without Spain's contribution,” he added.
Collin also expressed concern about the future, citing declining euro zone purchasing managers' indexes (PMIs) over the past two months and continued weakness in the manufacturing sector due to weak order volumes. As a result, he said the outlook for the third quarter is not bright.
For the European Central Bank (ECB), the current economic environment means a rate cut remains a possibility as domestic demand is unlikely to generate significant inflation, Colleen said. The ECB left its key interest rate unchanged at its July meeting after a major policy shift in June, cutting rates by 25 basis points for the first time since September 2019. ■
