The eurozone economy has returned to pre-epidemic levels

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Stronger-than-expected growth in France, Spain and Italy offset the slowdown in Germany, which resulted in a 0.3 per cent increase in eurozone GDP in the last quarter of last year, bringing the bloc back to pre-pandemic levels.

Quarterly growth in the euro area slowed from 2.2 per cent in the previous quarter with the spread of the Omicron version, but Eurostat, the EU’s statistical authority, estimates that annual GDP growth in the single currency region and the wider EU-27 will reach 5% in 2021. , 2 percent – the fastest expansion in the region since 1971, albeit at a slower pace than the U.S.-registered 5.7 percent.

Germany’s economy shrank 0.7 percent in the quarter due to lower consumer spending and problems in the manufacturing supply chain, leaving it 1.5 percent below pre-pandemic levels. The eurozone’s largest economy has lagged behind the recovery locomotive in the second half of the crisis.

France performed much better. According to national data on Friday, the country registered a 7 percent increase last year, the fastest expansion in 52 years.

Boosted by increased domestic demand, Italy grew 0.6 percent in the quarter, representing 6.4 percent full-year growth in national data, the fastest annual growth since at least 1995. Investors also welcomed the news that Mario Draghi would continue to be the country’s prime minister after Sergio Mattarella was elected president over the weekend.

Spain had the fastest growth in the eurozone in the fourth quarter, at 2 per cent, but its reliance on pandemic-affected tourism means it is still 4 per cent below pre-epidemic levels.

Inflation remained higher than expected in Germany (5.1 per cent) and Spain (6.1 per cent) in January, according to separate official data released today. The numbers add to the pressure on the European Central Bank to explain it still believes the eurozone price increase will return to its 2 per cent target during the year. Eurozone-level inflation data will be released on Wednesday.

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You need to know: the economy

Is it pandemic or endemic? There is a debate among scientists and politicians about how the world will move forward from the virus. The former emphasize that the coronavirus has not been defeated, while the latter are happy to treat it like any other serious disease — a threat but treatable.

The figure shows that Covid gradually became less fatal during the epidemic, mainly due to immunity, but still more dangerous than the flu on average.

The latest in the UK and Europe

The Sue Gray report on alleged violations of the long-awaited investigation pandemic restrictions It has finally appeared on Downing Street in the heart of the UK government. Boris Johnson apologized for attending the gathering in Downing Street Gardens. Here is a annotated analysis of the report.

Belongs to the United Kingdom crisis in the cost of living demands a tax cut, not an increase, argues Representative David Davis in France Télécom. One group – at least on paper – isn’t too bad homeownerswho enjoyed a 10 percent rise in house prices in 2021. France Télécom’s editorial staff hopes that the new statistical methods will shed light on how inflation affects different income groups.

THE the EU Recovery FundIt is the focus of Brussels ’post-pandemic recovery plans, which offer a unique opportunity for countries like Greece to become more competitive by reducing the cost of credit for businesses, writes Eleni Varvitsioti in Athens.

Global latest

Manufacturing and service activities here China According to recent data from the weekend, it got closer to shrinking in January. The country’s economy is under pressure from the severe pandemic constraints of the “zero Covid” strategy, lower demand and supply chain problems.

Emerging markets According to the IMF, those struggling with the pandemic have a new problem: the destabilizing risk of cryptocurrencies. Capital flows have been “destabilized” and the use of crypto instead of traditional currencies is “an immediate and acute risk,” Tobias Adrian said in an interview with France Télécom. Thailand rejected the 15 percent tax on cryptocurrencies.

You need to know: business

THE freight crisis it causes headaches to importers and exporters around the world, this is good news for a group of companies: container lines. Immediate freight rates for transporting the 40-foot container from Asia to Europe rose from $ 1,450 before the epidemic to $ 14,700, while container lines will generate $ 163 billion in operating profit in 2022, an increase of 8 percent from last year.

You can see a snapshot of an interactive graphic. This is probably because you are offline or JavaScript has been disabled in your browser.


Ryanair Omicron has announced it will give discounts on flights to boost demand after Omicron ruined bookings in the last three months of last year. The low-cost airline reported a net loss of € 96 million, up from € 321 million a year earlier, with revenue of € 1.5 billion for 31 million passengers.

Investors are turning away from him European junk bonds, is a key measure of market risk as geopolitical tensions and soaring inflation drive a shift away from risky assets.

High-yield bonds * basket insolvency cost line chart showing investor worries about recent lows over European end-of-life bonds

The world of work

France Télécom reporters are looking at what companies around the world are doing to address this labor shortage. For some, raising wages is only a short-term solution and they focus more on solutions such as technology investments that allow employees to spend more time doing work.

Major U.S. retailers are under pressure from shareholders to improve paid sick leave for their workers, this is an issue that was on the agenda at the time of the pandemic. A lawyer said: “Investors have good reason to think this is one of the social problems that equates to employee loyalty and long-term value.”

The horror warm desk it’s a common hassle for office workers, but as we slip into hybrid work patterns, providing a permanent workspace for all workers can be too costly for companies, says Clark Pilita.

Covid cases and vaccinations

All global cases: 369.3 m

Total doses administered: 10.1 billion

Get the latest worldview with us vaccine tracker

And finally…

Imagine yourself a stockpile? Try your luck against our FT journalists in our annual competition. Entries will close at midnight (GMT) on Sunday, February 6th and the competition will be judged on the gains or losses made between February 7th and December 31st. They don’t accept money – so the only possible loss is your pride.

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