Eurozone: Growth revised up in Q2 but remains at near two-year low
August 14, 2018
A second flash estimate released by Eurostat showed that subdued growth in the Eurozone economy at the outset of the year carried over to the second quarter. GDP expanded a revised seasonally-adjusted 0.4% in Q2 (previously reported: +0.3% quarter-on-quarter) from the previous quarter, matching Q1’s reading and marking the slowest pace of growth since Q3 2016. Compared with the same quarter of 2017, seasonally-adjusted GDP rose a revised 2.2% in Q2 (previously reported: +2.1% year-on-year), markedly below Q1’s 2.5% increase.
Although the flash estimate did not include a breakdown by components, weak gains in consumer spending, thanks to higher inflation and sluggish wage growth, and cooling sentiment, owing to trade concerns, likely weighed on economic performance. Additional data on individual countries revealed that growth picked up in Germany (+0.5% qoq) and the Netherlands (0.7% qoq) in the second quarter but moderated in Spain (0.6% qoq), Italy (0.2% qoq) and Austria (0.5% qoq). Meanwhile, growth in France (0.2% qoq) and Belgium (0.3% qoq) remained steady. More complete GDP data, including a breakdown by components, will be released on 7 September.
Author: Javier Colato, Economist