The delivery of the world’s second-largest cruise ship lifted France’s economy in the second quarter, according to official data that also showed Germany heading into a recession.
Built in Saint-Nazaire for the cruise ship operator Royal Caribbean, the Utopia of the Seas added €1bn (£840m) to French economic output, helping to increase trade growth to 0.6% in the three months to the end of June and gross domestic product to 0.3%.
The eurozone grew by 0.3% in the third quarter after a revised rate of 0.3% in the first, prompting many analysts to say that the 20-member euro bloc has turned a corner after flirting with recession in 2023.
Pushpin Singh, a senior economist at the Centre for Economics and Business Research consultancy, said the eurozone growth rate was better than expected by City analysts and “suggests the bloc has turned a corner since the start of the year”.
He added: “Prospects are likely to improve further throughout the year, driven by recent policy loosening by the European Central Bank and expectations for further interest rate cuts down the line.”
Bert Colijn, a senior economist at the Dutch bank ING, was more concerned that German growth would become a significant drag on the eurozone.
“Germany remains the weak link in this post-pandemic economy but the rest is not fantastic either.
“Leave out Spain and you just have an economy that moves along at a lacklustre growth pace.”
France’s economy grew marginally faster than expected and could improve again in the third quarter if the Olympics spur consumer spending, dispelling concerns that deadlock in the French parliament after recent elections would knock the
economy off course.
The French finance minister, Bruno Le Maire, said the economy’s performance in the second quarter and the Paris Games meant growth this year would probably exceed the outgoing government’s 1% forecast.
Source: The Guardian
