Europe's "Very Disappointing" Q1 GDP In Charts

Thank god for Germany, whose Q1 GDP printed at 0.8%, above the expected 0.7%, and higher than Q4's 0.4%, or else the Eurozone's very disappointing Q1 GDP, which printed at 0.2% or half the expected 0.4%, could have been flat or negative.

Here is what happened from the WSJ:

The euro zone's economy expanded at a weak pace last quarter despite a strong recovery in Germany, putting added pressure on the European Central Bank to enact fresh easing measures to prevent the region from sliding into a lengthy period of low inflation and economic stagnation.


Gross domestic product grew 0.2% in the euro zone during the first quarter compared with the final three months of 2013, the European Union's statistics agency Eurostat said Thursday, well short of the 0.4% quarterly gain expected by economists.


Last quarter's rise translates into growth of 0.8% in annualized terms, little changed from the fourth quarter. That masked a deepening divergence among the 18-member euro zone. Of the 13 euro members reporting GDP Thursday, only six expanded and some of those were small economies such as Latvia, Slovakia and Belgium.


The report "is a major disappointment, as it suggests that the euro zone is still far away from reaching the escape velocity required for a sustainable recovery," said ING economist Peter Vanden Houte, in a research note.

Naturally, the EUR got promptly hit after algos realized the EURUSD can't trade at 1.40 and have Europe grow at anything beyond stall speed.

Ironically, the strong GDP from Germany was explained by - what else - the weather. From Goldman:

Favourable weather at the beginning of the year is partly responsible for the strong first quarter reading. But even when taking this into account there can be little doubt that the underlying moment of the German economy is strong.  GDP was up 0.8%qoq (real, calendar adjusted) after +0.4%qoq in Q4 last year, a bit higher than consensus expectations of +0.7%qoq. The statistical office will release details only later this month but said in its press release that growth was driven "exclusively" by domestic demand. Private and government consumption increased, but the main driver seemed to have been investment spending (construction as well as equipment), which increased "meaningfully". Inventories also provided a positive growth contribution, while net trade was negative.

Well this is what happens when it is now ok for economists everywhere to be nothing more than constantly wrong weathermen.

Oddly enough favorable weather did not help France or Italy, the first of which came in at 0.0% below the 0.1% expected, and down from 0.2%, while Italy after briefly coming out of recession in Q4 with a positive print after constant negative GDP numbers, appears to be reentering recession after Q1 GDP came at -0.1%, below the 0.2% expected, and down from 0.1%.

Goldman was not happy:

Today's data are at odds with improving business sentiment. Business sentiment has generally improved in Q1, with the composite PMI gaining almost 2pt on the quarter (51.9 in Q1 after 50 in Q4). Similarly, the Istat survey rose by 1pt in Q1. Both surveys are now around/or above their respective long-term averages and thus indicate positive growth

Perhaps maybe someone was lying?

Anyway, here is the full breakdown in table format...

... and as a map.



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