The eurozone's economy grew by a
stronger-than-expected 0.3% in the last three months of 2014, helped by rapid
growth in Germany. Germany's economy - the largest in the eurozone - grew by 0.7% in the
quarter, comfortably beating analysts' forecasts. However, France's economy grew by just 0.1% in the same period. Figures from European statistics agency Eurostat showed the eurozone's economy
grew by 0.9% across 2014 as a whole.
While Germany's economy shrank 0.1% in the third quarter of last year, strong
domestic demand helped it to regain momentum in the fourth quarter, the Federal
Statistical Office said. The economy grew by 1.6% during 2014.
"This is a thunderbolt," said UniCredit economist Andreas Rees. "Some spoke of possible recession after the summer but instead Germany
rebounded. The fact that the growth comes mainly from the domestic economy gives
strong grounds for optimism," he said. The strong data helped to lift European stock markets, and the German Dax
index climbed above the 11,000 mark for the first time.
Berenberg Bank economist Christian Schulz suggested cheaper oil, a weaker
euro exchange rate and government bond buying by the European Central Bank (ECB)
should all help the German economy and "more than offset the serious short-term
risks such as Greece and Russia".
"While the first half of 2015 could still be a little more subdued due to
these risks, we expect German growth to reach trend levels a bit above 2% in the
summer 2015."
Meanwhile, France's anaemic fourth quarter growth meant the economy expanded
by just 0.4% over 2014 as a whole. "It's obviously still too weak, but the conditions are ripe to permit a
cleaner start of activity in 2015," said French Finance Minister Michel Sapin.
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