Euro area Q3 GDP rises 0.3 pct, positive contribution seen from household consumption

Euro area third quarter gross domestic product (GDP) released earlier on Tuesday by statistics agency Eurostat. Data showed that seasonally adjusted GDP rose by 0.3 percent in the euro area (EA19) and by 0.4 percent in the EU28 during the third quarter.  In the second quarter of 2016, GDP grew by 0.3 percent and 0.4 percent respectively.

Compared with the same quarter of the previous year, seasonally adjusted GDP rose by 1.7 percent in the euro area and by 1.9 percent in the EU28 in the third quarter of 2016, after also +1.7 percent and +1.9 percent respectively in the previous quarter.

Details of the report showed that Croatia (+1.7 percent), Slovenia (+1.0 percent), Greece and Portugal (both +0.8 percent) recorded the highest growth compared with the previous quarter, while Lithuania recorded the lowest growth (+0.1 percent).

Household final consumption expenditure had a positive contribution to GDP growth in both the euro area and the EU28, while the contribution from gross fixed capital formation was neutral in both zones. During Q3, household final consumption expenditure rose by 0.3 percent in the euro area and by 0.4 percent in the EU28, while gross fixed capital formation increased by 0.2 percent in both zones.

The data will not have a significant impact on near-term policy trends. The crucial element will be whether the Eurozone economy can break out of the underlying weak growth trend under the influence of a very accommodative monetary policy. Market reaction to the data was largely muted.

​FxWirePro's Hourly EUR Spot Index was at 42.9564 (Neutral), while Hourly USD Spot Index was at -77.4707 (Bearish) at 1320 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex