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-   -   Euro Zone Booming ! (https://skyscraperpage.com/forum//showthread.php?t=114285)

Fabb Aug 29, 2006 8:30 AM

Euro Zone Booming !
 
http://www.finfacts.com/irelandbusin...paug142006.jpg

BRUSSELS, Belgium (Reuters) -- The euro zone economy grew at its fastest quarterly rate in six years in the second quarter, reinforcing market expectations of two rather than one more interest rate rises by the European Central Bank this year.

European Union statistics office Eurostat said on Monday gross domestic product in the 12 countries using the euro rose 0.9 percent quarter-on-quarter in April to June -- the fastest growth since the second quarter of the dot-com boom year 2000.

Eurostat said that year-on-year, GDP growth in the euro zone accelerated to 2.4 percent from 2.0 percent in the first quarter and 1.7 percent in the last quarter of 2005.

Economists polled by Reuters had expected 0.7 percent quarterly growth and a 2.3 percent annual expansion.

"The recovery is no longer in question. The data is a bit too good because there are special effects, but clearly this is growth above trend," said Holger Schmieding, economist at Bank of America.

While detailed figures on GDP components will be available only from August 31, economists said country data suggested second-quarter euro zone growth was fueled mainly by domestic demand -- private consumption and investment.

They said consumption was probably exaggerated by the soccer World Cup held in Germany in June and July as well as a rebound in construction activity after poor weather in winter, but even despite that, growth was strong.

The second-quarter expansion is a further acceleration from the 0.6 percent quarterly growth in the first three months and 0.3 percent in the last quarter of 2005.

It was led by the euro zone's two biggest economies, Germany and France, which expanded 0.9 percent and 1.2 percent on a quarterly basis respectively.
ECB expected to raise rates again

In a regular forecast, the European Commission raised its estimate for third-quarter GDP growth in the euro zone to a range of 0.5-0.9 percent quarter-on-quarter from 0.3-0.7 percent projected on July 12. It cut its fourth-quarter GDP growth forecast to 0.4-0.9 percent from 0.5-1.0 percent.

In the first quarter of 2007, the Commission expects the euro zone economy to expand between 0.2 and 0.8 percent on a quarterly basis, it said in a statement.

Economists said the strong second quarter made it almost certain that the European Central Bank, which has been hiking rates since December to stem inflationary pressure from record credit growth and oil prices, would keep raising credit costs.

"At the moment, the ECB faces an environment in which GDP growth is robust, business surveys are still upbeat, money growth is in double-digit territory and inflation is well above target," said John Butler, economist at HSBC.

"We take these numbers as confirmation that the ECB will hike again in October and then again in December, taking rates back to 3.5 percent by the end of the year," he said.

But the bank is likely to pause after that for most of 2007, to see what happens in the global economy and what effect a planned rise in German value-added tax will have on economic growth, economists said.

Copyright 2006 Reuters

pricemazda Aug 29, 2006 12:05 PM

Good news, all round.

We need a eurozone recovery before the doubters in the UK, Sweden and Denmark will consider joining the euro.

The UK has revised its growth forecasts up to 2.8%.

The Dear Leader Aug 30, 2006 4:42 PM

It'll be a shortlived recovery, at least here in Germany.

pricemazda Aug 30, 2006 6:06 PM

I don't think so across the world economies are picking up again, Japan, France, Germany, growth is being revised upwards in the UK as well.

This is a global revival.

Fabb Aug 30, 2006 8:49 PM

More good news...
 
Aug. 30, 2006, 1:48PM
France Jobless Rate Slips to 8.9 Percent

© 2006 The Associated Press

PARIS — France's unemployment rate fell to 8.9 percent in July, a 4 1/2 year low, the Labor Ministry said Wednesday.

The ministry said there were 2,159,900 jobseekers in July, down 26,700 from June, when the jobless rate stood at 9 percent.

Economists had expected the July figure to remain unchanged from June's levels, though France's unemployment rate has been on a downward path in recent months, helped by stronger economic growth and fewer new jobseekers.

The Dear Leader Aug 31, 2006 1:56 PM

Quote:

Originally Posted by pricemazda
I don't think so across the world economies are picking up again, Japan, France, Germany, growth is being revised upwards in the UK as well.

This is a global revival.

You underestimate the suckiness of the German government. Higher taxes in all areas mean that next year we'll probably have 0.5% growth or something like that.

pricemazda Aug 31, 2006 3:54 PM

who would you rather though Merkel or Schroeder? Count your blessings young man.

The Dear Leader Aug 31, 2006 3:58 PM

Merkel's just as bad as Schröder...maybe even worse.

Exarchus Aug 31, 2006 4:04 PM

Lol, I should be a prophet. I predicted Merkel's promises were all on winds.

Go Shroeder!!! Economy is all about reading chicken's guts.

Simaru Aug 31, 2006 4:23 PM

Wath is the percent "booming"?? because the informations say the data is a bit too good because there are special effects, but clearly this is growth above trend.

one very bored guy Aug 31, 2006 4:56 PM

Quote:

Originally Posted by The Dear Leader
It'll be a shortlived recovery, at least here in Germany.

:lol: comeon. If everyone in Germany had the same opinion as you, the economy would never improve.

Remember, consumer and business confidence can bring a country out of recession.

Then again, Germans are ultra cautious people, which is one of the reasons the recessions can last so long here. When times get tough, Many Germans go into hibernation instead of spending money, even when their own personal financial situation hasn't changed.

Fabb Aug 31, 2006 6:09 PM

Quote:

Originally Posted by The Dear Leader
Higher taxes in all areas mean that next year we'll probably have 0.5% growth or something like that.

The anticipation of the VAT increase will probably result in a spending spree by the end of the year.
That's not so bad.

The Dear Leader Aug 31, 2006 6:30 PM

Quote:

Originally Posted by one very bored guy
:lol: comeon. If everyone in Germany had the same opinion as you, the economy would never improve.

Remember, consumer and business confidence can bring a country out of recession.

Then again, Germans are ultra cautious people, which is one of the reasons the recessions can last so long here. When times get tough, Many Germans go into hibernation instead of spending money, even when their own personal financial situation hasn't changed.

The thing is that Germany's main problems, like the situation on the labor market, simply haven't been addressed yet. As long as the government sits on its hands, we won't see a true recovery.

tergeste Aug 31, 2006 6:38 PM

So Germany needs Hartz V, VI, VII, VIII.......XLVIII ;)

Nexus6 Sep 2, 2006 6:33 PM

Merkel is not the problem. The problem are the voters who bashed Merkel in the elections for be beeing honest and ultimately forced her to join a coalition with the socialists. Merkel now simply complies to the will of the people by not enforcing strict reforms...

tergeste Sep 2, 2006 6:53 PM

Well, even if she didn't want to comply with the will of the people and make bold reforms, she would be hampered by having to share a coalition with the SPD (which in turn won a large number of seats because of the will of the people).

The Dear Leader Sep 3, 2006 12:14 PM

Quote:

Originally Posted by Nexus6
Merkel is not the problem. The problem are the voters who bashed Merkel in the elections for be beeing honest and ultimately forced her to join a coalition with the socialists. Merkel now simply complies to the will of the people by not enforcing strict reforms...

And where has this gotten her? Right, lowest poll ratings ever. She ran a horrible campaign, that's why she ultimately lost her conservative/free democratic majority.

If people felt she was doing the right thing by doing nothing, her poll ratings would probably be higher.

Nexus6 Sep 3, 2006 7:25 PM

Quote:

Originally Posted by The Dear Leader
If people felt she was doing the right thing by doing nothing, her poll ratings would probably be higher.

You assume that voters act reasonable - they don't. Merkel's ratings don't fall because of inaction but because people dislike the fact that she wants to raise taxes. The voters want a state which spends alot on social security but doesn't collect the money for that from them. The voters bashed Merkel in the elections for announcing cuts in social security and now that she reversed course and wants to keep a high level of security they bash her for collecting the money that is necessary to finance it.:jester:

Mercutio Sep 13, 2006 11:54 AM

^ That's the same in every democracy. Voters always want government to spend more and tax less. There's always a balance to be struck and the debate is where to strike that balance.

The Dear Leader Sep 16, 2006 1:53 PM

Will Italy leave/be kicked out of the euro zone?

All this seems bizarrely at odds with the growing belief, particularly in London, that Italy may risk falling out of the euro. A study being published shortly by a London-based think-tank, the Centre for European Reform (CER), puts the odds of this happening at a daunting 40%. Mr Padoa-Schioppa is scathing about such talk. “My time is rather short, and I decided not to spend any of it on nonsensical scenarios,” he says. “That is a nonsensical scenario.”

Is it? There are, in fact, two variants of it. One envisages Italy's public finances deteriorating to the point where its debt loses investment grade (which would require only two further downgrades by the main rating agencies). That would sharply raise debt-servicing costs, pitching the government into a downward spiral of surging interest rates and rising deficits.

[...]

Yet it is the second variant of Italy leaving the euro that should perhaps be more worrying. This envisages the country pulling out because its competitiveness erodes to a point where membership becomes too painful. Indeed, it is this continuing loss of competitiveness, and not its public finances, that may be the biggest economic problem facing Italy. The CER study concludes that it is five minutes to midnight, and that the Italian government “needs to act now to ensure the country's long-term membership of the euro zone”."


http://www.economist.com/world/europ..._id=E1_SJTTPVG

See also: http://www.cer.org.uk/pdf/pr_688_eurozone_tilford.pdf


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