The European economy is growing. But optimism is out of place

The beast last week brought several very good at first glance from Europe. According to preliminary estimates, the euro area’s gross domestic product grew by one percent in the second quarter of this year, which is the best result in the last four years.

The five result not only sharply surpassed the growth rate in the first quarter, which reached only 0.2 percent, but was just over a tenth of you, not the original pot consensus on the market.

Germany was the most successful

However, as the results of GDP, which were published simultaneously in some euro area countries, showed, the strongest growth in Germany was Germany, which improved by 2.2 percent quarter on quarter.

Of the large economies, the Netherlands (+ 0.9 percent) and France (+ 0.6 percent) performed well, while, for example, the Spanish economy contracted by 0.2 percent in the second quarter. Itlie, which started a week ahead of GDP growth, then grew by 0.4 percent in the second quarter.

Rst thla foreign demand

Pten gives so confirm what many of them have been doing for a long time. Although the euro area grew strongly in the second half of the year, its growth was almost exclusively for export-oriented countries, and thus for external factors such as foreign demand.

She has been very strong in the past half year. The economic recovery in the USA and the sharply weakened European currency, which lost within six months and twenty percent of its value to the dollar and eight percent to the pound, contributed to this.

In particular, it first explains why stock indices in Europe have not been able to break free from the selling pressure they have been under in the past few days.

“He had a sight,” as Chancellor Merkel recently called the current situation, is slowly coming to an end. The euro has strengthened against the dollar by five percent since June, and in the meantime the US economy has begun to slow sharply.

The problems of the United States are even such that last week the US Federal Reserve (Fed) had to look forward to another loose policy change, a step that two months before markets could not even imagine.

The debt crisis has been reminded again

The second half of the year could therefore differ from night to day as night and day, with the first signs of the cooling of European growth coming to the surface after the holidays.

If fears of a slowdown in Europe prove to be the case, fears of a debt crisis, triggered by financial market turmoil during the second quarter of this year, may re-emerge. The European states are still very familiar with the fact that the problems with budget deficits can be solved with the contribution of economic growth, which will generate a sufficiently high income budget.

At the same time, the debt crisis will not escape the financial market even during relatively quiet holiday months, which was confirmed last week. This time the source was Ireland, which is very expensive to rehabilitate its banking sector.

Following the loss of the now national Anglo Irish Bank, it needs another financial injection from the state, which (10 billion euros) surprised the financial markets a week. As a result, the Irish deficit may go ahead in 2010, not the originally estimated 13.4 percent of GDP. The Irish government bonds reacted to this with a sharp sell-off, when the yield from the ten-year maturity jumped by almost half a percent and to 5.40 percent.