Eurozone economy expanded less than initially estimated in the first quarter but it was the fastest growth in a year.
Gross domestic product climbed 0.5 percent in the first quarter from the prior quarter, when it grew 0.3 percent, the flash estimate from Eurostat showed Friday.
The latest expansion was the fastest since the first quarter of 2015, when GDP climbed 0.6 percent. Eurostat previously estimated 0.6 percent growth for the first three months of 2016.
On a yearly basis, GDP growth eased marginally to 1.5 percent from 1.6 percent. The annual growth rate for the first quarter was revised down from 1.6 percent.
The breakdown of GDP data is set to be published on June 7. The releases from member nations suggest that overall growth was driven by domestic demand, while net trade made little contribution.
The expansion was largely driven by Germany, where GDP grew 0.7 percent, the fastest in two years. Domestic demand and investment underpinned activity, while foreign trade had a slight downward effect.
At 0.5 percent, the French economic growth was also triggered by household spending. Among other major economies in the bloc, Spain's growth held steady at 0.8 percent in the first quarter, while Italy expanded only 0.3 percent.
The EU28 economy logged a 0.5 percent sequential growth and 1.7 percent annual expansion. Both growth figures were kept unchanged from the previous estimates.
IHS Global Insight economist Howard Archer said the improvement in first quarter Eurozone GDP growth also reinforces belief that the European Central Bank will remain in "wait and see" mode for the next few months despite the Eurozone seeing renewed deflation of 0.2 percent in April.
The European Commission forecast 1.6 percent growth for this year and 1.8 percent for 2017.
Jonathan Loynes, an economist at Capital Economics, expects Eurozone GDP growth of a pretty meager 1.2 percent or so this year, well below the rate needed to push inflation back up to the ECB's target on a sustained basis.
by RTT Staff Writer
For comments and feedback: editorial@rttnews.com
Economic News
What parts of the world are seeing the best (and worst) economic performances lately? Click here to check out our Econ Scorecard and find out! See up-to-the-moment rankings for the best and worst performers in GDP, unemployment rate, inflation and much more.
