No country in the euro area has seen its economy shrink in the second quarter. But that reality, the recovery of Europe after the hard years of the Great Recession, is still a half-written page on the uncertainties hanging capable of borronearla.
If Germany has favorably surprised thanks, again, to the strength of its exports, France and Italy, the largest economies in the euro zone after the German country, they had zero growth between April and June. The Gallic country blames short-term issues such as the strike in the French refineries while Italy blames the slowdown in the industry.
The concern plans more strongly on Rome. The lack of progress of its economy, Italy joins its status as the second most indebted country in Europe after Greece-more than 132% of GDP and a banking sector questioned by accumulating bad loans amounting to 360.000 million euros.
what’s more, these sum circumstances the possibility of a new political crisis this fall: Matteo Renzi has already announced he will step down as prime minister if the Italians refuse to approve the constitutional reform referendum next October.
“The greatest short-term risks are in Italy. The combination of a banking and political crisis could pose a serious threat to the weak European recovery,” says Oxford Economics analysis. The growth of the Italian economy compared to last year is a weak 0.7%, and Italy was the only major economies in the euro zone to cut the IMF last July its growth forecast for this year, it stood at 0.9%.
the break of France has surprised more after an encouraging first quarter, and the own French authorities described the figure for the second quarter of disappointing, but the notice has not yet resulted in alarm given the strong advance of the first part of the year
the predictions of the Bank of France also play in his favor. the company expects a rebound of 0.3% in the third quarter and the Government of François Hollande maintains growth forecast at 1.5% this year.
the speed at which moves the European bloc is far from uniform. The story goes neighborhoods and the leader Angela Merkel has been above expectations with a 0.4% thanks to consumption and especially the export sector. The made in Germany remains guarantee of growth for Germany, which sends abroad goods and services worth over 100,000 million euros each month.
The country has ignored so far all appeals from international organizations to devote to public investment part of this gigantic trade surplus cemented around a powerful industry that provides automobile, machinery or chemicals to much of the world. Commerzbank has raised its forecast improvement in GDP this year to 1.8%, one tenth more than what they expect the German authorities.
Amid the many shadows that still surround it, there are also shy lights in the hardest hit eurozone economy in recent years. Most forecasts suggest that Greece return to growth next year, but meanwhile, has surprised with two encouraging data by lowering the collapse of its economy in the first quarter and improved by 0.3% in the second.
the Spanish GDP is the second fastest growing eurozone with an improvement of 0.7% already put forward in late July, the National Statistics Institute, one tenth less than in the previous three quarters and an increase of 3.2% over the previous year. A mild slowdown that currently does not question the strength of the recovery, which still has a pending the reduction of unemployment, far from European standards.
Outside the limits of the eurozone, the British economy accelerated its growth to 0.6%. The consultation on their stay in the European Union was held as the second quarter drew to a close, so the greater or lesser impact Brexit in its economy and the bloc will begin to be felt in the next data.
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