The euro has overcome a four-day losing streak against the dollar on the news the German economy is growing at its fastest pace in nearly 20 years. Some economists suggest the whole European economy is gaining momentum, while others paint a more conservative picture.
News that Germany’s economy outpaced predictions is not however, surprising. Europe’s largest economy has led the way for Europe since reunification back in 1991. This latest news reveals Germany’s GDP up 2.2 percent in contrast to a predicted 1.3 percent projection. France has also shown substantial growth through the first two quarters of this year, the Northern European economies obviously taking their normal positions in the EU scheme of things.
As for Southern Europe, Greece’s (contracting another 1.5 percent) woes – along with those of Spain and others – continue to drag down the overall European prospects for recovery – as is normal. Some forecasters act as if these events and economic figures are anything but ordinary, of course Germany is going to have to carry the weight of the recovery – who else?
German exports have always been a driving force behind that economy – no big secret there. The problem some experts harp upon here is that exports cannot continue to prop up the euro zone for long. It seems the “gold ring” for economic recovery, and better yet stabilization, for other EU economies would be a stronger export component as well.
Greece, Spain, Romania, and any number of other countries need to produce more to weather storms and have more positive role within the EU. Just why more attention is not focused here is anyone’s guess. At least for now, the strength of Germany’s economy still balances the equation.
About Phil Butler
