Gross domestic product (GDP) in the eurozone rebounded two percent in the second quarter (Q2) of this year compared to the previous one on the back of two consecutive quarterly declines, Eurostat, the statistical office of the European Union (EU) said on Friday.
In Q2 2021, seasonally adjusted GDP in the 27-member EU grew by 1.9 percent.
Year on year, seasonally adjusted GDP increased by 13.7 percent in the eurozone and by 13.2 percent in the EU in Q2.
Eurostat said that growth was mainly due to the progress in the COVID-19 vaccination campaigns across the bloc and to the gradual lifting of restrictions by the member states, which reignited the individual economies.
Among the EU countries for which data are available, Portugal recorded the highest quarter-on-quarter GDP increase at 4.9 percent, followed by Austria (4.3 percent) and Latvia (3.7 percent). Lithuania (0.4 percent) and the Czech Republic (0.6 percent) recorded the lowest increases.
Despite the threat posed by the COVID-19 Delta variant and the continuing supply chain concerns, experts at ING bank expect GDP growth to reach two percent again in the third quarter of 2021.
"The eurozone economy continues to perform like a diesel engine: it takes a while to get going but don't underestimate it once it's picked up steam," commented Bert Colijn, senior financial expert at ING.
This strong economic performance has had a positive impact on the labor market. In a separate release, Eurostat said the unemployment rate in the eurozone fell to 7.7 percent in June from eight percent a month earlier.
In the EU as a whole, the unemployment rate decreased by 0.2 percentage points month-on-month to 7.1 percent.
Some 14.9 million people were unemployed in the EU in June, including 12.5 million in the eurozone.
According to Eurostat, the annual inflation rate in the eurozone rose to 2.2 percent in July, up from 1.9 percent in June and exceeding the European Central Bank's two percent target.
The rise in the annual inflation rate was mostly fueled by energy prices, which are projected to increase by 14.1 percent in July compared with 12.6 percent in June.