Investing.com - Financial Markets Worldwide
⚠ Selloff or Market Correction? Either Way, Here's What to Do NextSee Overvalued Stocks

More Evidence That Germany's Growth Is Sustainable

ByBenzinga
AuthorBenzinga
Published 08/28/2013, 11:12 AM
Updated 05/14/2017, 06:45 AM

The euro was hovering just below the $1.34 mark in the early hours of Wednesday as confidence returned to the 17 nation bloc. Positive data has attracted investors back to the eurozone despite looming problems like Italy's current political situation and sky high unemployment figures.

Businessweek reported that the German business climate index climbed to 107.5 in August, its highest level in 16 months. The figure beat forecasts of 107 and showed sizable improvement from July's 106.2 reading.

The business climate index came shortly after GDP data showed Germany led the eurozone out of its longest ever recession by growing 0.7 percent in the second quarter. Even more impressive, the growth came from private consumption, which many see as a good sign of a sustainable recovery.

However, the report's findings were not as positive when it came to construction activity. The figures showed that German construction activity fell to -4.2 in August, compared to -1.5 in July. Also worrying was the report's measure of retailing, which slipped to 2.6 from 3.

Despite that, most still see the German economy as on track for a strong recovery. The Bundesbank is expecting German GDP to grow by 0.3 percent in 2013 and a further 1.5 percent in 2014.

As for the eurozone as a whole, the outlook isn't as rosy. The European Central Bank has predicted that the eurozone will contract 0.6 percent in 2013 before returning to growth and expanding 1.1 percent in 2014. The bank's president, Mario Draghi, has promised that the ECB would keep rates at 0.5 percent for an extended period to support the region's recovery.

By Laura Brodbeck

Latest comments

Loading next article…
Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.