May 3, 2019 The euro zone economy offers good surprises

The gross domestic product of the 19 countries that adopted the single currency rose 0.4% in the first three months of the year, according to figures released Tuesday.

The euro zone economy started in 2019 with faster growth in the first quarter and lower unemployment in March. In a context of trade tensions fueled by US protectionist threats and lingering uncertainty about Brexit, the figures from the European Statistical Office, Eurostat, are much better than expected.

Thus, according to a provisional estimate, the gross domestic product (GDP) of the 19 countries that adopted the single currency rose by 0.4% over the first three months of the year, compared with 0.2% in the last quarter of 2018. It exceeds the expectations of analysts surveyed by Factset's financial service, who were counting on 0.3%.

Fall in unemployment in March

Second good surprise: unemployment in March fell to 7.7% (against 7.8% in February), while analysts expected stagnation. This is also the lowest rate recorded in the euro area since September 2008. It is close to the average rate before the financial crisis of 2007-2008, where it stood at 7.5%.

"Fears of a recession in the eurozone were certainly premature," said Peter Vanden Houte, Chief Economist of ING, after the publication of these figures. "The decline in unemployment and the gradual rise in wages support household consumption, while the conditions for granting credit remain easy," added the expert.