Germany Is The Protagonist Of European Recovery
Germany had the highest rate of private sector output in the last 8 months, and lead European economy to the highest level in the past 4 years. This could sign the promising European recovery.
Eurozones services and manufacturing index is now at 54.1 exceeding the experts’ predictions of 53.6. Expansion and growth is marked by a number higher than 50. Entire Europe took hold of the momentum, as generation of jobs and gain in order is evident in the continent, at the highest level since 2007.
Although at slower pace, even the slow French economy signaled improvement, with the increase in the activity of private sector. This is the same trend as the previous month in France, and the economy has reached the performance levels of 2011. Markit chief economist, Chris Williamson said that in the first three months of 2015, Gross Domestic Product is expected to rise 0.2%.
European Central Bank, which initiated its 1.1 trillion euros quantitative easing package in the beginning of March will be pleased with the data indicating that the Eurozone grew 0.3% in the opening quarter of 2015.The prices of services and products declined in the slowest rate since July 2014, which suggests the lesser effects of deflation, more positive information for the Eurozone. While the region is still waiting for confirmation that ECB’s QE is helping the real economy, Williamson said that “The improvement provides welcome news.”
Buying of bonds will have valuable effects on the real economy, claims the President of ECB, Mario Draghi. “Lower interest rates in capital markets are increasingly being transmitted through the entire financial intermediation chain” explained Draghi to the European Parliament on Monday.
Low exchange rates and the further decline in oil prices encouraged the manufacturers of Eurozone, INGs Teunis Brosens said. Brosens remained cautious and added that even if ECB is giving their maximum, “There is work to do in several European capitals to strengthen Europe’s growth potential.”