The European economy began to revive

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The European economy began to revive. In countries that began to loosen the restrictive measures, there has been a surge of economic activity in some areas, writes Finanсial Times.

Germany, Italy and Spain in the last couple of weeks eased a number of restrictive measures, allowing some shops and other facilities to resume work. At the same time, France plans to gradually remove the block on may 11.

Although the changes are not yet reflected in official economic statistics, some indicators such as electricity consumption and transportation, are already showing signs of recovery.

“There are some tentative signs of improvement in economic activity, for example, the increase of electricity consumption in Italy and Spain,” said an economist for Europe at Capital Economics, said Jessica hinds. However, she warned that it is too early to talk about improvements, and that other indicators “has yet to show much progress, if any”.

In Italy and Spain the consumption of electricity grows from mid-April — in contrast to France, where it is still at a very low level. Meanwhile, data on mileage of German trucks started to show modest growth after a fall.

There is also some evidence that German and Spanish workers return to their jobs. The index of mobility by Google, which monitors the movement of people in factories and offices, showed a trend towards a positive change, although activity is still at a very low level. In Germany the number of work trips has declined by 43 percent compared to a typical week before the new coronavirus, and in Italy, Spain, France and the UK this figure fell in the interval from 63 to 68 percent.

Analyst in the Europe of UBS Felix hufner noted that the sectors of retail, transport, entertainment, accommodation and catering most affected by the virus, and “every measure that helps the service sector, which is important for recovery.”

“The direct economic impact of the coronavirus likely to be more felt in the economies of the southern Eurozone and France than in the Nordic countries, where the localization was easier,” said a senior economist at Dutch Bank ING Bert Colan. In his words, “a rapid return to daily life will not.”

An economist from Oxford Economics angel Talavera noted that the process of removing the limitations will take months, and it means that economic activity is likely to remain below their precoronation levels until the end of this year.

Previously, experts predicted Europe’s GDP to fall by 10 percent in the first half of 2020, and the most affected country from mers called Romania.

Video, photo All from Russia.

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