The 19-nation Eurozone's economy grew by about 2% in the second quarter of 2021, taking the region out of recession, though the Eurozone remains about 3% down from late-2019 pre-pandemic figures. Compared to the same quarter a year ago, the latest Gross Domestic Product (GDP) readings represent a 13.7% increase while Eurostat figures suggest that there was economic growth in all Eurozone nations which reported data. Chief Europe Economist of Capital Economics, Andrew Kenningham, forecasts another "strong number in Eurozone GDP" in the third quarter of 2021, bringing "the economy close to, but below, its pre-pandemic level".
Austria and Portugal reported strong economic expansion, with the latter reporting growth of 4.9% thanks to increased tourism while Italy and Spain reported growth of nearly 3%. Meanwhile, Germany and France, the Eurozone's two largest economics, reported more moderate growth of 1.5% and 0.9% respectively. Generally, household spending increased in the second quarter of 2021.
Latest Eurostat figures show that the number of unemployed people fell by over 400,000 in the month of June though annual inflation is projected to increase from 1.9% in June to roughly 2.2% in July. While the European Central Bank (ECB) targets to support an annual inflation rate of 2%, the ECB expect the inflation rate to continue rising as economies reopen, though it is expected to "calm down" again in the start of 2022.
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