The Eurozone economy grew by 0.6% QoQ in Q3, following an upwardly revised 0.7% QoQ in Q2 as growth exceeded expectations, including that of our own, explains the analysis team at Rabobank.
“Of the large Eurozone countries only France and Spain have published Q3 growth estimates so far; their economies grew by 0.5% and 0.8% respectively, a moderation of 0.1%-point from Q2 growth. In both countries domestic demand was the main growth driver.”
“Going forward, the higher than expected Q3 growth does not change our view of strong yet slightly diminishing economic momentum and moderately increasing headwinds. Mainly on the back of somewhat lower employment growth and pent-up demand, consumption growth is set to slow a bit in 2018. The stronger euro and weaker activity in the UK are expected to slightly temper export growth as well. That said, due to the higher than expected numbers for Q2-Q3, we are likely to ‘mechanically’ revise upwards our EZ GDP growth outlook for 2017 from 2.1% to 2.3%, and possibly from 2.0% to 2.1% in 2018, during our next forecasting round in November.”
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