growth

French construction sector reduces by 0.4% the GDP growth in 1H14

MADRID | The Corner |Besides naming the reshuffle of his Government, after a dispute over hauling the economy out of stagnation caused his government’s collapse, François Hollande has also committed to announce this week a package of measures to revive the economy, including specific stimulus for the construction activity, especially affected in terms of employment by a law to regulate the real estate market precisely adopted at the beginning of his term. It is estimated that construction activity in France represents about 8% of GDP and 1.2 million jobs.


Germany’s business climate continues to worsen, but labor market keeps its strength

BERLIN | By Alberto Lozano | German IFO index has shown today that business climate continues to worsen. The German Business Sentiment registered its fourth consecutive decline after falling 1.7 points from the previous month to 106.3 points, representing its worst reading since July 2013 decline. “The German economy continues to lose steam”, indicates Hans-Werner Sinn, president of the IFO Institute. “The outlook for the coming months also deteriorated noticeably.”


No Picture

Draghi’s speech marks a turning point in ECB rhetoric

MADRID | The Corner | Although it is not part of ECB’s mandate, last Friday in Jackson Hole, President Mario Draghi spoke about what needs to be done in the euro area to address the problem of high unemployment and weak economic growth. As Barclays analysts believe, the speech “represented a significant breakthrough in the ECB rhetoric and will probably have significant implications regarding the debate just about to start between European government on policies that need to be deployed to avoid a ‘triple-dip recession’ and a fall in outright deflation.”


ECB might wait to take further action

Madrid | The Corner | Despite last bad figures of the Eurozone economy, European stock markets are rising on expectations of ECB further action. However, it seems that ECB will wait to see if the actions taken until now and the TLTROs of September and December will take effect. Meanwhile, both Barclays and UBS analysts trust in these measures to support European recovery.


Spanish construction sector will grow in 2015 for the first time in 6 years

MADRID | The Corner | The construction sector in Spain will grow next year by 1% compared to 2014, according to Cesce, a company specialized in credit services and commercial risk management. Thus this growth will change the downward trend that had maintained the sector during the last six years. According to Cesce, the building will boost the sector but the public works and engineering will have to reach the bottom and it will not start to recover until 2016, when it will reach 3% growth YoY.


No Picture

Spain registers the highest EU construction growth in 2Q

MADRID | The Corner | Spain was the EU28 member state with the highest increase in the production in construction during the 2Q, with an increase by 7.0% YoY, according to first estimates from Eurostat. Moreover, Spain was the fourth country in the EU28 with the biggest increase in the production in June, with a growth of 6.8%. However, the construction experienced a decline of 2.9% in June in comparison to May, which represents the second biggest monthly decline of this variable among the EU28 member states. In June compared with May 2014, seasonally adjusted production in the construction sector fell by 0.7% in the euro area and by 0.3% in the EU28.


UBS: Brazil’s GDP growth loses momentum

MADRID | The Corner | 2014 is not being a good year for LatAm. All countries in the region with the exception of Colombia have experienced much softer than anticipated growth. In Brazil, the political noise and uncertainty have impacted on the confidence and private activity in 1H201, with investments and private consumption leading the way down. UBS analysts see now Brazil’s real GDP growth at 0.6% in 2014 and 1.5% in 2015.


No Picture

US residential construction recovers in July

MADRID | The Corner | After two months of decline, US construction rebounds in July at the fastest pace in eight months. As the Commerce Department reported yesterday, the number of housing starts rose 15.7% in July compared to June, reaching an annualized figure of 1.09 million units, the highest in eight months. Meanwhile, applications for building permits in the same month also advanced  8.1% to an annual rate of 1.05 million, after drops of 3.1 percent in June and 5.1 percent in May. Notably the permits to build single-family homes, a segment that accounts for three quarters of the U.S. housing market, increased in July by 0.9% to an annualized figure of 640,000, the highest since December 2013. In addition, permits for units in buildings with five units or more rose 23.6% in July to an annual rate of 382,000, representing its highest growth rate since January 2006.


ECB under pressure, markets demand QE policy

MADRID | The Corner | The European weak economic growth increases the pressure on the ECB to take additional measures or the long-awaited QE to boost growth, beyond those already announced in June and of which the effects probably will not be seen until 2015. At the moment the ECB in its monthly report reemphasized that there is “a continued moderate and uneven recovery of the euro area economy”, with low inflation rates and a weak monetary and credit evolution. At the same time, inflation expectations for the euro area in the medium and long term remain firmly anchored in line with the ECB’s target of keeping the inflation rates at levels below but close to 2%.


No Picture

Spain’s growth beats its EZ larger peers in the 2Q

MADRID | The Corner | Spain’s GDP expanded by 0.6% in the 2Q of 2014 over the previous quarter, the fastest pace in the Eurozone after Latvia’s growth (+1%). With Portugal (+0.6%) and Netherlands (+0.5%), Spain becomes one of the best economic performers in the eurozone during this quarter. Moreover, according to the figures published today by Eurostat, the Euro area has stalled in the 2Q, especially as a result of the contraction of Germany, the Italian fall into recession and France’s stagnation. Meanwhile, the Greek economy contracted by 0.2%, the lowest drop since 3Q 2008 and it could show that the country is meeting its full year growth target of 0.6% for 2014.