/Eurozone: Despite speedbumps, expansion continues – Wells Fargo | by Matías Salord | FXStreet

Eurozone: Despite speedbumps, expansion continues – Wells Fargo | by Matías Salord | FXStreet

Analysts at Wells Fargo, look for the Eurozone economic expansion to generally remain intact after real GDP grew 2.5% in 2017, the strongest annual growth rate since 2007.  Key Quotes:  “Data released this week confirmed that real GDP in the Eurozone grew at an annualized rate of 2.4 percent on a sequential basis in Q4-2017. The new information in the data release—preliminary data printed at the end of January—was the breakdown of the GDP data into its underlying demand components.” “The good news is that all domestic spending components (i.e., consumer spending, investment spending and government spending) continued to expand in Q4. The bad news is that sequential growth in domestic demand was sluggish, rising only 1.5 percent on an annualized basis. Strength in exports relative to imports—the former rose nearly 8 percent while the latter grew only 4.4 percent—boosted the overall rate of real GDP growth in the fourth quarter.” “The data from January that are now starting to trickle in suggest that economic activity may be decelerating a bit in early 2018 (…) Does this mean that the expansion in the euro area is stalling? Probably not.  “Real GDP in the Eurozone grew 2.5 percent in 2017, which was the strongest annual growth rate since 2007. We look for some deceleration this year, but we expect that the expansion in the Eurozone will generally remain intact.”