Germany’s economy grew at the weakest pace in more than a year at the start of this year, part of a slowdown across the eurozone that the European Central Bank (ECB) says could prove temporary.
The 0.3 percent expansion in the first quarter was softer than economists had forecast and just half the pace seen in the final three months of last year.
The statistics office said growth was driven by domestic demand, while trade lost momentum.
From a year earlier, adjusted GDP rose 2.3 percent.
The slowdown in Europe’s biggest economy is further confirmation that the region had a sluggish start to the year, a development already apparent in business surveys and other indicators.
Yet ECB officials have dismissed a deceleration of eurozone momentum to 0.4 percent from 0.7 percent as a combination of factors such as a flu epidemic and colder weather, and expect it to dissipate in the course of the year.
“Whether this marks the end of a robust expansion or is just a bump in the road is crucial to understand as the ECB mulls the end of asset purchases. We think a modest amount of momentum has been lost, but that 2Q will see a rebound,” Bloomberg Economics analysts Jamie Murray and David Powell said.
Speaking on Monday, ECB Governing Council member Francois Villeroy de Galhau said growth remains solid and broad-based, and that policymakers were still likely to halt asset purchases this year.
The European Commission has also indicated it is not overly concerned and this month maintained its forecast that full-year growth would almost match the decade-high pace hit last year.
Still, threats ranging from trade tensions to higher oil prices and market volatility could act as a brake.
Bank of Finland Deputy Governor Olli Rehn on Monday said that risks to the medium-term outlook “seem to be tilted on the downside.”
However, the Bundesbank remains optimistic, saying that record orders should boost German output in the coming months.
Just last week, Siemens AG raised its outlook for full-year earnings and HeidelbergCement AG said the economic upswing would boost construction activity in its major markets after a long winter held back first-quarter results.
Germany’s statistics office said growth at the start of the year was bolstered by a pickup in equipment investment and construction, and a slight increase in private consumption.
Government spending declined for the first time in almost five years, with exports and imports also down.
Taiwan’s exports soared 56 percent year-on-year to an all-time high of US$64.05 billion last month, propelled by surging global demand for artificial intelligence (AI), high-performance computing and cloud service infrastructure, the Ministry of Finance said yesterday. Department of Statistics Director-General Beatrice Tsai (蔡美娜) called the figure an unexpected upside surprise, citing a wave of technology orders from overseas customers alongside the usual year-end shopping season for technology products. Growth is likely to remain strong this month, she said, projecting a 40 percent to 45 percent expansion on an annual basis. The outperformance could prompt the Directorate-General of Budget, Accounting and
Two Chinese chipmakers are attracting strong retail investor demand, buoyed by industry peer Moore Threads Technology Co’s (摩爾線程) stellar debut. The retail portion of MetaX Integrated Circuits (Shanghai) Co’s (上海沐曦) upcoming initial public offering (IPO) was 2,986 times oversubscribed on Friday, according to a filing. Meanwhile, Beijing Onmicro Electronics Co (北京昂瑞微), which makes radio frequency chips, was 2,899 times oversubscribed on Friday, its filing showed. The bids coincided with Moore Threads’ trading debut, which surged 425 percent on Friday after raising 8 billion yuan (US$1.13 billion) on bets that the company could emerge as a viable local competitor to Nvidia
BARRIERS: Gudeng’s chairman said it was unlikely that the US could replicate Taiwan’s science parks in Arizona, given its strict immigration policies and cultural differences Gudeng Precision Industrial Co (家登), which supplies wafer pods to the world’s major semiconductor firms, yesterday said it is in no rush to set up production in the US due to high costs. The company supplies its customers through a warehouse in Arizona jointly operated by TSS Holdings Ltd (德鑫控股), a joint holding of Gudeng and 17 Taiwanese firms in the semiconductor supply chain, including specialty plastic compounds producer Nytex Composites Co (耐特) and automated material handling system supplier Symtek Automation Asia Co (迅得). While the company has long been exploring the feasibility of setting up production in the US to address
OPTION: Uber said it could provide higher pay for batch trips, if incentives for batching is not removed entirely, as the latter would force it to pass on the costs to consumers Uber Technologies Inc yesterday warned that proposed restrictions on batching orders and minimum wages could prompt a NT$20 delivery fee increase in Taiwan, as lower efficiency would drive up costs. Uber CEO Dara Khosrowshahi made the remarks yesterday during his visit to Taiwan. He is on a multileg trip to the region, which includes stops in South Korea and Japan. His visit coincided the release last month of the Ministry of Labor’s draft bill on the delivery sector, which aims to safeguard delivery workers’ rights and improve their welfare. The ministry set the minimum pay for local food delivery drivers at
RSS