Eurostat’s quick estimate confirmed what the preliminary figures already suggested. In the second quarter, the eurozone economy experienced a clear rebound, increasing 2.0% compared to the first quarter of the year and 13.6% over one year.
Of course, the countries most affected by the first wave in Spring 2020 and whose economy was on its knees at that time are the ones where the rebound is the most marked: Spanish GDP grew by 19.8%. 18.7%, 17.3%, 15.5% and 14.5% respectively.
On the other hand, Germany and the Netherlands are satisfied with a smaller rebound, at 9.2% and 9.7%.
As the European vaccination campaign continues to grow in the third quarter, the rebound is expected to continue. Therefore, the eurozone should stay on a good momentum on what remains of the year.
By 2022, when the bulk of the funds provided for the European recovery plan applies, it is expected to build a more productive and competitive economy, better adapted to the challenges it will face.
However, improving the growth potential of an old and lagging Europe will not be noticeable in many future sectors. It also remains to be seen how the pandemic will evolve in Europe, Asia, and North America.
As Europe remains a major exporter, the demand development in these regions is of greater importance to many European companies.
We maintain a small exposure to eurozone equities across our portfolio.