Altough European growth has significantly slowed down in the initial phase of 2014, it still outpaces the US in tems of development. This is the first time in three years in which Europe appears stronger than the United States.
Various country's domestic products grew in the Eurozone and the pace of growth was 0.9% in the first quarter. In the US, companies grew slower, with only 0.1% in the first quarter, compared to Europe's 0.9% in the initial phase of the year. The American companies blamed the severe weather conditions for the decrease in thei consumer interest. Also they attributed their slow performance to the factors of decreased export conditions and reduced investments in the business and the residential sector.
The countries that have marked slow growth are France and Italy, and Germany and the Netherlands still remain strong in their growth and economic development.
"The best that can be said ... was that at least the eurozone has now managed to grow for four successive quarters, following six quarters of contraction through to the first quarter of 2013," according to IHS chief European economist Howard Archer.
Germany officials have explained that most likely the mild weather conditions has resulted in more consumer spending and better market conditions. The euro is still strong and is beating the US dollars in terms of performance.
Investors are awaiting new economic forecasts in order to make the most reasonable decisions. The Russian-Ukraine conflict has negatively affected the US and European economy, and at this point, only hope for conditions not to deteriorate.
The conflict in Ukraine has alread indicated that numerous industries could be negatively affected, as consumer spending in Russia and Ukraine has significantly decreased. Numerous companies in Germany, Italy and France have already demonstrated weaker performance because of the tension in the Eastern-European regions. This is a major burden to current economic decisions and may continue to affect consumer spending in the long run.
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