Italy and Spain are helping drive the eurozone out of recession following a stronger than expected expansion in the second quarter of 2021.
Conversely, the eurozone’s top two economies – Germany and France fell short of expectations.
The single currency area beat forecasts of a 1.5% increase in GDP thanks to the Italy’s and Spain’s results.
Second quarter growth
Figures from Eurostat show the eurozone grew at an annual rate of 13.7% in the April to June period. This is a stark improvement to last year’s covid-hit results.
The second quarter of 2021 growth followed declines of 0.6% in the final three months of 2020 and a further 0.3% drop in the first quarter of this year. Fresh covid waves across Europe and the world were the primary contributory factor.
A computer chip shortage led to supply chain issues which in turn affected Germany’s manufacturing. Their expected growth of 2% in the second quarter was not matched with the actual result of 1.5%
Italy shows growth of 2.7%
However, the third and fourth largest eurozone economies – Italy and Spain – grew faster than expected.
Italy doubled the analysts’ expected results of 1.3% with a second-quarter growth of 2.7%. Spain pipped Italy with a 2.8% growth following a first quarter decline of 0.4%
France showed the weakest growth of the top four eurozone economies registering only 0.9%.