(MENAFN– ecpulse) Euro area growth stalled in the second quarter as Germany’s economy contracted and France stagnated, adding more pressure on policymakers to come out with new measures to bolster growth.
The eurozone failed to expand in the three months through June after posting a 0.2 percent in the previous three months.
On the yearly basis, the GDP came in at 0.7 percent, compared the prior of 0.9 percent.
Germany recorded its first drop in output since the start of 2013, failing to play the usual role of the savior for the 18-nation region.
Data released this week showed that German investor confidence resumed its drop for an eighth straight month in August.
In Italy, the euro area’s third biggest economy plunged into recession for the third time since 2008 after dropping 0.2 percent.
On the upside, Spain recorded its fastest growth pace since 2007 in the second quarter, while Netherlands returned to growth.
Recovery is weak, fragile and uneven, where geopolitical tensions in Ukraine continue to hurt the economy, ECB President Mario said this month. There has been a slowing down in the growth momentum.
Overall survey data is consistent with a “continued moderate and uneven recovery in the euro area economy,” Draghi mentioned.
The ECB opted to leave interest rates on hold in August while refrained from introducing new measures to wait and see the impact of the rates cut announced in June.
Policymakers announced new measures in June to stave off low inflation and bolster banks’ lending, where these measures would take effect in September.
CPI for the year ended July remained unrevised at its low level of 0.4 percent, according to a report released today.
However, the PMI composite of manufacturing and services sectors rose to 54.0 in July from 52.8 in June, reaching a three-month high, to provide hopes momentum is gaining traction with the beginning of the third quarter.
Last month, the International Monetary Fund revised up its 2014 growth forecast for Germany while leaving it unchanged for the euro area.
As of 09:10 GMT, the euro was little changed versus the U.S. dollar to trade near the session’s opening at 1.3364.
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