According to the recent report by Eurostat, the preliminary estimates of the Euro Area and EU27 GDP growth rate in first quarter of 2011 was only 0.8% (seasonally adjusted) compared to the previous quarter (Q-2-Q).
In annual terms the Euro Area grew by 2.5% (Y-2-Y) in the first quarter of 2011.
Among the leading Euro Area countries that also led the GDP growth was Germany with 1.5% (Q-2-Q) increase.
The expectations were a bit higher than the actual preliminary report showed, and this news might have caused a stir in the financial markets as the EURO/USD lost 0.89% on Friday.
Nonetheless, the slow recovery of the Euro Area will be relative to the US economy; this comparison between the growth rates of these two economies will likely to affect traders’ perspective when trading EURO/USD.
The recovery of the Euro Area will also affect the worldwide demand for major commodities including crude oil and natural gas.
During March 2011, the industrial production in the Euro Area (seasonally adjusted) declined by 0.2% compared to February 2011. In annual terms (compared to March 2010) the industrial production grew by 5.3% in the Euro Area.
In the energy sector, the industrial production in the Euro Area declined by 0.7% during March, after a decline of 0.2% in February.
This report also shows the slow recovery of the Euro Area in the first quarter of 2011 and might indicate that at the current high crude oil prices the industrial production might continue to fall in the months to come.
For further reading (in this site):
- Weekly outlook for May 16-20
- Gold didn’t move | Silver kept on falling – weekly recap 9-13 May
- The EURO/USD drops as ECB left interest rate unchanged
- US inflation rose by 0.4% in April