The Eurozone’s estimate of second growth has been revised higher after the first full look into all the regions national accounts, Quarterly expansion was up 0.4% for the second quarter versus the first estimate of 0.3%. Annual growth was up 1.5% its best performance since the second quarter 2011.
While the boost to the headline number is good news, sadly majority of the contribution came from oversea demand. While household consumption also rose 0.4% on the quarter, gross fixed capital contracted 0.5% which, with government consumption up 0.3%, meant that domestic final sales added a just 0.2% to the quarterly change in output. Inventories contracted by 0.1%
The largest positive impact came from exports where a 1.6% quarterly bounce lifted GDP economic growth by 0.7% points. Imports were up 1.0 percent which left a contribution of 0.3%
Among the individual member states:
• Latvia (1.2 percent)
• Malta (1.1 percent)
• Spain (1.0 percent)
• Slovakia (0.8 percent)
• Germany (0.4 percent)
• Italy (0.3 percent)
• France (0.0 percent)
So overall we can see Eurozone growth had to rely heavily on the smaller countries.
If not for the help of exports the Eurozone economy would have been close to stagnation. Household consumption slowed for a second consecutive quarter and we also had a renewed fall in investment.