On the domestic side, expansion of private consumption and investment should benefit, in particular, from ongoing employment growth and higher rates of capacity utilisation. Domestic demand is also supported by high business and consumer confidence.
On the external side, the upturn of growth in the world economy appears to be stronger, faster and more broadly based than was expected at the end of last year. Hence, euro area exports should remain strong. Financial market developments also support the view that the economic expansion in the euro area is set to continue at a fast pace.