The lights of Frankfurt am Main's banking skyline glow in the last light of day.
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The eurozone economy grew more than expected in the second quarter of 2024, preliminary figures from the European Union's statistics office showed on Tuesday.
The data showed that the region’s gross domestic product rose by 0.3% in the three months to the end of June from the previous quarter. Economists polled by Reuters had forecast a 0.2% quarter-on-quarter increase.
First-quarter GDP growth was confirmed at 0.3%, unchanged from the preliminary reading announced earlier this year.
The eurozone entered a technical recession in the second half of 2023, with GDP contracting in the third and fourth quarters of the year, according to revised figures released earlier this year.
The data suggests the region's economy is recovering somewhat, Bert Colijn, ING's senior eurozone economist, said in a note on Tuesday.
“After stagnation throughout 2023, this is a relief and shows that the economy is starting to cautiously recover,” he said, adding that the economy is now in a better position than it was a year ago.
“The question remains as to where the economy will go from here, and recent data does not provide much confidence that the eurozone economy is accelerating further,” Collins said.
Data released earlier today showed that Germany, the euro zone's largest economy, unexpectedly contracted by 0.1% in the second quarter – less than analysts polled by Reuters had expected the country's gross domestic product to grow by 0.1%.
Germany was one of only four countries whose gross domestic product fell in the three months to the end of June, according to the European Union’s statistics office. Latvia, Sweden and Hungary were the other three to record a contraction.
The German economy is “stuck in a crisis” and is also not expected to improve much in the third quarter, Klaus Wohlrabe, head of surveys at the Ifo institute, said in a note on Wednesday.
Meanwhile, Ireland posted the biggest growth of 1.2% in the second quarter, while France, the eurozone's second-largest economy, saw GDP grow by 0.3% during the same period, the French statistics office said on Tuesday.
Eurozone inflation data is due on Wednesday. The new eurozone data this week comes after the European Central Bank left interest rates unchanged at its meeting earlier this month, saying the option of a rate cut in September was “wide open.”
