Strong Q2 growth for euro zone

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Strong Q2 growth for euro zone

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Germany was the engine of growth for the euro zone economy in the second quarter of the year.

Gross domestic product expanded at the fastest rate since the reunification of West Germany and communist East Germany two decades ago.

A surge in investment and exports provided fresh evidence the recovery in Europe’s largest economy has shifted up a gear.

The strong reading boosted GDP for the entire euro zone; it rose by one percent quarter-on-quarter, the best in over three years.

In Germany the economy grew 2.2 percent from the previous quarter.

France enjoyed a solid if less impressive rise of 0.6 percent, while Spain maintained a feeble pace of growth of 0.2 percent.

While European governments can take some comfort from the fact that growth looked better overall during the second quarter of the year, many policymakers fear the quarters ahead will be weaker and more in line with what the European Central Bank has predicted will be a “moderate and still uneven” recovery.

Economists warned that Spain, hard-hit by the collapse of a building boom as well as the end of a global credit bubble, is likely to slip back into recession in the second half of the year.