Growth in the US and the Eurozone strengthens in Q1

10 May 2019


...Eurozone growth strengthens in Q1... 

The Eurozone economy grew by 0.4% in Q1 2019, the strongest growth since Q2 2018 and is up from the growth of 0.2% recorded in the previous quarter (see Chart below). Of the available country level data, Spain, the fourth largest economy in the Eurozone, grew by 0.7% in Q1, while Italy exited recession, recording growth of 0.2% in the quarter. The drop in the Eurozone unemployment rate to a decade low is likely to have helped drive stronger consumer spending, helping to boost overall growth in Q1. However, the slowdown in China, global trade tensions and Brexit uncertainty are likely to weigh on Eurozone growth over the coming quarters.


...and US growth picks up…

According to the first official estimate, the US economy grew at an annualised rate of 3.2% in Q1 2019. This was the first time in four years that the typically subdued Q1 GDP growth figure has exceeded 3% and is up strongly from growth of 2.2% in Q4 2018 (see Chart below). The uptick in growth was driven by stronger trade growth with US exports rising by 3.7% in Q1 and imports declining by 3.7% over the same period. US GDP growth also received a temporary boost from firms building up their inventories in the quarter. Consumer spending, which accounts for around two-thirds of US economic output, slowed to 1.2% in Q1, down from 2.2% in the previous quarter. 


Read full BCC Monthly Economic Review May 2019 here.


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