Euro-area growth in the third quarter was bolstered by private consumption and government spending as exports suffered from a slowdown in global trade.
Gross domestic product in the 19-nation bloc rose 0.3 per cent in the three months through September after expanding 0.4 per cent in the prior quarter, the European Union’s statistics office said Tuesday in Luxembourg, confirming a Nov. 13 estimate.
The data come less than a week after the European Central Bank cut one of its main interest rates to a record low and expanded its asset-purchase program to at least €$1.5 trillion to shore up the region’s muted economic recovery and bring inflation closer toward 2 per cent. While domestic spending is benefiting from lower oil prices, exports are damped by an economic slowdown in emerging markets.
“The recovery remains very much a consumption-driven story going into 2016, and the external side should turn from neutral to slightly positive next year,” said Holger Schmieding, chief economist at Berenberg Bank in London. “We have a dent caused by emerging markets, but the risk has lessened over the last two months.”
Government spending climbed 0.6 per cent in the third quarter from 0.3 per cent in the previous three months, and household consumption accelerated to 0.4 per cent from 0.3 per cent. Gross fixed capital formation was unchanged from the second quarter, when it rose a revised 0.1 per cent. Exports rose 0.2 per cent and imports increased 0.9 per cent. From a year ago, the 19-nation economy expanded 1.6 per cent, according to Eurostat.
The ECB presented fresh economic projections on Dec. 3 that were largely unchanged from September, even as ECB President Mario Draghi pointed to downside risks emanating from “heightened uncertainties regarding developments in the global economy as well as to broader geopolitical risks.”
News by Bloomberg, edited by ESM. To subscribe to ESM: The European Supermarket Magazine, click here.
