The economy of the Eurozone achieved growth higher than expected

30.07.2024. / 13:51

BRUSSELS – The eurozone economy grew more than expected in the second quarter, official data showed on Tuesday, confirming the common currency zone’s recovery since January.

The EU statistics agency said the 20-nation eurozone grew by 0.3 percent in the April-June period, which was more than the 0.2 percent expected by analysts polled by FactSet and Bloomberg.

Despite the eurozone beating expectations, growth was lower than in the US, highlighting a persistent transatlantic gap, with Germany, Europe’s leading economy, recording a decline.

German gross domestic product, which represents the total production of goods and services, decreased by 0.1 percent.

At the Eurozone level, growth follows a similar performance of 0.3 percent from the January-March quarter, which was the first significant growth after more than a year of stagnation slightly above, at or below zero.

In contrast, the US economy grew by 0.7 percent in the second quarter compared to the first quarter, or 2.8 percent on an annualized basis.

American consumers are spending freely, while government spending from larger budget deficits and subsidies for business investment, on renewable energy under the Inflation Reduction Act, and on semiconductor manufacturing and infrastructure is also contributing to US growth.

Those two trends have been reversed in Europe, where consumers are saving at record levels and governments have begun to curb spending to reduce budget deficits. Radio Free Europe