Euro area econ­omy steams ahead in Q2 as ECB waits for in­fla­tion

Muscat Daily - - BUSINESS -

Zurich, Switzer­land - The euro area econ­omy ex­panded apace in the sec­ond quar­ter, a sign the bloc’s up­swing is be­com­ing in­creas­ingly ro­bust and self-sus­tain­ing.

Gross do­mes­tic prod­uct in the 19-coun­try re­gion rose 0.6 per cent in the three months through June, after in­creas­ing 0.5 per cent at the start of the year.

Fig­ures from eco­nomic con­fi­dence to job­less­ness and man­u­fac­tur­ing out­put have sig­naled the econ­omy was gain­ing steam, un­der­pin­ning ex­pec­ta­tions by the Euro­pean Cen­tral Bank (ECB) that price pres­sures would even­tu­ally be­gin to build.

Pol­icy mak­ers are pre­par­ing for a de­bate in the au­tumn about the fu­ture path of quan­ti­ta­tive eas­ing, which has helped re­duce fi­nanc­ing costs for firms and house­holds, thus stim­u­lat­ing de­mand.

“The ECB ex­pects solid, broad-based growth in the pe­riod ahead, and it’s pretty likely this will hap­pen,” said Hol­ger Sandte, chief Euro­pean analyst at Nordea Mar­kets in Copen­hagen. “They will wel­come th­ese num­bers but the fo­cus will be on core in­fla­tion - whether it picks up and how fast.”

ECB Pres­i­dent Mario Draghi has ex­pressed con­fi­dence that the solid, broad-based re­cov­ery will ex­tend into the sec­ond half, with a heal­ing labour mar­ket and a clos­ing out­put gap fu­elling a sus­tained in­fla­tion pickup.

Newspapers in English

Newspapers from Oman

© PressReader. All rights reserved.