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EZ Q1 GDP Downgraded to -0.1% Q/Q

MNI (London)

EUROZONE Q1 FINAL GDP -0.1% Q/Q (FCST 0.0% / FLASH +0.1%); Q4 -0.1% Q/Q

EUROZONE Q1 FINAL GDP +1.0% Y/Y (FCST +1.2% / FLASH +1.3%); Q4 +1.8% Y/Y

  • Eurozone Q1 GDP was revised downwards to -0.1% q/q from +0.1% q/q initially in today's final release. This is now lower than the +0.1% q/q initially forecasted by the March ECB macroeconomic projections.
  • The Bloomberg consensus was looking for a flat reading, however -0.1% was on the table. Q1 GDP was 0.3pp below flash estimates, at +1.0% y/y.
  • The negative Q/Q euro-area reading will have largely been downgraded due to the surprise downward revision of German final Q1 GDP to -0.3% q/q, from 0.0% estimated in the flash. Ireland also saw a marked downgrade, to -4.6% q/q from -2.7% q/q.
  • Negative Q/Q growth was recorded across seven euro countries: Germany (-0.3%), the Netherlands (-0.7%), Ireland (-4.6%), Greece (-0.1%), Lithuania (-2.1%), Estonia (-0.6%) and Malta (-0.5%).
  • For the bloc, final household consumption expenditure contracted by -0.3% q/q (vs -1.0% in Q4) , whilst government spending fell -1.6% q/q (vs +0.8% in Q4). Exports were down -0.1% q/q and imports fell -1.3% q/q. This implied a -0.1pp contribution from household expenditure, -0.3pp from government spending and -0.4pp from inventories, partially offset by +0.1pp from gross fixed capital formation and +0.7pp from net exports in Q1.

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