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Konjunkturerholung im Euroraum nur zögerlich. DIW Berlin: Spürbare Belebung erst in der zweiten Jahreshälfte

Press Release of June 12, 2002

According to calculations by the DIW Berlin, GDP in the Eurozone increased by 0.3% in the first quarter of 2002; a figure which corresponds to a current annual rate of 1.2%. Last year's weak economic cycle seems to have begun to gradually recede. This slight recovery is mainly attributable to a higher net trade in goods and services; while exports in the Eurozone increased by 1%, imports experienced a marked decrease. Domestic demand components have not really given off any growth impulses so far. Private consumption stagnated during the first quarter; investments continued their downward trend.
Growth will only accelerate slightly during the second quarter. According to the DIW Berlin, this is mainly due to slack development in the credit sector and a low rate of capacity utilisation, which has fallen below the long-term average and which is an indicator for the lack of additional investment. Investment will not start to recover before the second quarter of this year. Private consumption will only increase slowly, because employment will only expand slightly this year in the Eurozone and because collective agreements should again be fairly moderate. Any stimulation of demand is most likely to originate from abroad.
A growth forecast published by the European Commission confirms the scenario described by the DIW. The growth rate should be higher in the second quarter than in the first quarter, but with an increase of between only 0.3% and 0.6% compared to the first quarter, economic growth is, far below the forecasted figures. A increased growth rate of between 0.7% and 1% can be expected only in the second half of the year.