Eurozone GDP growth better than originally estimated in Q1

Eurozone GDP grew faster than initially estimated in the first quarter, while employment growth for April was also revised up, according to figures released by Eurostat on Wednesday.

GDP rose by 0.6% on the quarter in the eurozone, following 0.2% growth in the final quarter of 2021. This was up from an earlier estimate of 0.3% growth.

On the year, GDP was up 5.4% following a 4.7% increase in the previous quarter.

Ireland recorded the highest increase in GDP compared to the previous quarter, up 10.8%, followed by Romania and Latvia, up 5.2% and 3.6% respectively. Declines were seen in Sweden, where GDP fell 0.8%, and France and Denmark, which recorded falls of 0.2% and 0.1%.

Eurostat data also showed that the eurozone unemployment rate was stable in April versus March, at 6.8%, and down from 8.2% in April 2021.

Jack Allen-Reynolds, senior Europe economist at Capital Economics, said: "The upward revision to euro-zone GDP in Q1 was in large part down to the huge increase in Ireland, where the GDP data are notoriously unreliable.

"So the data aren’t as good as they look. And we still think that the eurozone will grow more slowly than the consensus expects this year."

He pointed out that the alternative measure of activity in Ireland - modified domestic demand - showed a 1% contraction.