The European economy, in the strongest expansion in a decade, registered 2.5 per cent gross domestic product growth in 2017, the Eurostat agency said on Wednesday. That's the growth rate for both the 19-member eurozone and the 28-member European Union, whose last strongest expansion was in 2007, just before the financial crisis that plunged Europe, if not the whole world, into a recession, reports Xinhua.
The figures published by Eurostat, the EU's statistical office, were "the end of a very successful year for the euro area economy, with growth far exceeding expectations," according to a research note from Daiwa Capital Markets Europe, which added that "a significant part of that success story was an improvement in global trade and manufacturing momentum, which the euro area benefited from."
Meanwhile, analysts said Wednesday that Europe's largest economy Germany will likely maintain or pick up its pace of growth this year, after booking a 0.6-per cent expansion between October and December.
"In 2017, all planets were aligned" for the German economy, Florian Hense of Berenberg bank said, even as a tricky September election made for months of political horsetrading in Berlin that has yet to produce a stable government.
The fourth-quarter figure follows up growth of 0.9 per cent in the first three months of 2017, 0.6 per cent in the second, and 0.7 per cent in the third -- all adjusted for price, seasonal and calendar effects. Combined, the quarterly results add up to 2.2-per cent expansion over the full year, the fastest rate since 2011.
Wednesday's data confirmed a preliminary estimate of full-year growth Destatis released in January.
The final three months of the year saw exports contribute more strongly to growth than they had between July and September. However, private consumption remained roughly flat quarter-on-quarter, while government spending increased.
Investments in capital goods increased, while construction spending fell back.
"Looking ahead, the same fundamentals which have supported growth in 2016 and 2017 should still be in place" this year, economist Carsten Brzeski of ING Diba bank said, pointing to low interest rates, a strong labour market and a synchronised upturn across the 19-nation eurozone. "The economy could continue at its current pace for at least one or two more years without showing signs of overheating," he added. Germany's economy ministry in January forecast slightly faster expansion of 2.4 per cent this year.
