Euro Area Q2 GDP Annual Growth Rises On Qrtr, Up 2.3% On Year

--On Quarter Growth at +0.6%, Unchanged on First Estimate

By Shaily Mittal

     FRANKFURT (MNI) - Euro area economic growth in the second quarter of 2017

gained pace on both annual and quarterly basis, though the rate of acceleration

was much higher on an annual basis, data released by Eurostat Thursday showed.

     The updated second flash estimate confirmed GDP growth at 0.6% q/q in the

second quarter, up from the 0.5% q/q in the first quarter. On the year, GDP rose

to 2.3% y/y (revised upwards from 2.2% y/y in first flash reading) from 2% in

the previous quarter (revised upwards from 1.9% y/y in first flash reading),

underlining the recovery in the economies of the Eurozone. 

     The fastest growing nations in the Eurozone in Q2 consisted of the

Netherlands (calendar adj 1.5% q/q ), Estonia (1.3% q/q) and Latvia (1.2% q/q).

     Household final consumption showed the greatest contribution to GDP growth

in the euro area, adding 0.3 percentage points (pp) to growth while gross fixed

capital formation added 0.2 pp to growth, with the share of both components

having increased from Q1. Government expenditure and net exports (exports less

imports) contributed 0.1 pp to growth. In contrast, inventories impacted

negatively.  

     In Q2, household final consumption expenditure rose by 0.5% q/q in the euro

area from 0.4% in the previous quarter. Gross fixed capital formation increased

by 0.9% after contracting in the previous quarter. Exports slowed slightly,

growing 1.1%, the slowest since Q3 2016 while imports increased significantly,

up 0.9% from 0.4% in Q1, indicating stronger demand in the area.

     In the European Union as a whole GDP was up 0.7% q/q (revised up from 0.6%

in the first flash reading) and 2.4% y/y (revised up from 2.3% in the first

flash reading), Eurostat data showed. 

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: M$E$$$,M$X$$$,MT$$$$,M$XDS$]