Belgium’s economy expanded in the fourth quarter at the fastest pace in almost three years, adding to evidence the euro area’s recovery is gaining steam.
Gross domestic product in Belgium, the sixth-largest economy in the currency bloc, rose 0.4 percent in the fourth quarter from the prior three months, the biggest increase since the beginning of 2011, the National Bank of Belgium said today. The economy grew 0.9 percent from the year-earlier quarter. A breakdown of GDP components will be published in March.
The euro area is showing more and more positive signals as the economy gathers momentum after the longest recession since the debut of the euro. Factory output in the bloc expanded this month at the fastest pace since May 2011 and economic confidence is forecast to rise to the highest in 2 1/2 years.
It is “likely that Belgian activity benefited in the fourth quarter from positive growth in the neighboring partners and even in some countries in euro-zone periphery,” said Philippe Ledent, an economist at ING Groep NV in Brussels. “That’s why the number released today for Belgium is also a good sign for the whole of the euro zone.”
Economists estimate that expansion in the euro-area economy accelerated to 0.2 percent in the fourth quarter from 0.1 percent in the previous three months, according to a Bloomberg survey. GDP data for the 18-nation bloc will be released next month.
In Germany, Europe’s biggest economy and one of Belgium’s largest trading partners, business confidence rose to a two-year high in January, the Ifo institute said this week. A euro-area index of executive and consumer sentiment is forecast to climb to 101 this month, which would be the highest since July 2011, according to a separate survey of economists.
Belgium’s fourth-quarter growth of 0.4 percent was an acceleration from the 0.3 percent GDP increase in the prior three months. For all of 2013, the Belgian economy grew 0.2 percent, after a contraction of 0.1 percent in the previous year, the central bank said in today’s report.
“The strength of Britain’s growth in 2013 probably played an important role” in Belgium’s expansion, Ledent said. The U.K. economy grew 1.9 percent in 2013, its best year since 2007, data showed yesterday.
For Belgium, “private consumption is also likely to have played a role in the positive growth, as it already was the case during the three first quarters of last year,” Ledent said. “If confirmed, the revival of domestic demand would be a key element for 2014’s growth.”