Europe economy

Eurozone growth buoyed by services and construction

Ana Andrade, an analyst at The Economist Intelligence Unit, reminds us that the rosy Eurozone GDP figures bucked a trend set by other indicators.

"Euro area composite PMI had gone deep into contractionary territory in Q1," she says.

But, "the decline in manufacturing output and sentiment seems to have been more than offset by positive trends in the services and construction sector."

European unemployment fall

A revealing graph from Eurostat, showing EU28 unemployment at the lowest level since records of the current data set began, in 2000.

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Eurostat

BreakingEurozone unemployment at post-crisis low

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The eurozone area's seasonally-adjusted unemployment rate was 7.7% in March 2019, down from 7.8% in February 2019 and from 8.5% in March 2018, according to Eurostat.

That is the lowest rate recorded since September 2008, the start of the global financial crisis.

The unemployment rate in the wider EU also dropped to 6.4% in March 2019, down from 6.5% in February 2019 and from 7.0% in March 2018.

That's the lowest level in 19 years.

BreakingEU GDP up by 0.5%

The flash estimate of European GDP for the first three months of 2019 is in.

Seasonally adjusted GDP rose by 0.4% in the eurozone and by 0.5% in the wider EU, compared with the previous quarter,

That's faster than same period last year.

Eurozone starts 2019 'on flat note'

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It's not just UK services that are struggling. Eurozone businesses started the year by expanding at their weakest rate since mid-2013, survey data suggests.

IHS Markit’s Eurozone Composite Final Purchasing Managers’ Index (PMI), dipped to 51.0 from December’s 51.1 - barely above the 50 mark separating growth from contraction.

“The eurozone has started 2019 on flat note, with growth close to stagnation amid falling demand for goods and services,” said Chris Williamson, chief business economist at IHS Markit.

“What started as a manufacturing and export-led slowdown has shown increasing signs of infecting the service sector.”

Mario Draghi

Andrew Walker

BBC World Service economics correspondent

European Central Bank chief Mario Draghi is more cautious about eurozone growth - likely to push rate rises into the distance.

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