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Wednesday, August 16, 2006


ECONOMY GROWS 0.9% IN EUROPE 

Almost 1% is lauded as a milestone in Europe's Central Bank yet that number significantly trails the economic progess made in the United States.

[NY Times]: With France and Germany leading the way, the economy in the 12 nations that use the euro currency grew at its fastest quarterly rate since 2000, a development that is expected to fortify the resolve of the European Central Bank to raise interest rates again this year.

The gross domestic product of the nations grew 0.9 percent from April to June compared with the previous quarter, Eurostat, the statistics agency of the European Union, reported Monday. Growth has recently mostly reflected strong exports, but the latest figure received a lift from business investment and consumers, whose reluctance to spend has been the hallmark of the slow recovery.

The German economy, where households have been the most tightfisted, also grew 0.9 percent.

“Domestic demand is doing its job, finally,” said Erik Nielsen, chief Europe economist with Goldman Sachs. “We finally have a little drive from something other than exports, which is good.”

The data broadly confirmed figures released by various countries over much of the last week, most recently France on Friday. Though overall growth is accelerating in the euro region, it is uneven, with France growing at a rate of 1.1 percent to 1.2 percent in the quarter, and Italy lagging at 0.5 percent.


FoxNews.com reported that the United States gross dometic product grew by 2.5% in the second quarter of 2006 and by 5.6% in the first quarter of 2006.

According to Bloomberg.com, the Mexican economy grew by 4.4% in the April-June period after growing by 5.5% in the January-March period.

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