Given the broadly stable savings rate, increased labour income is translating into higher private consumption expenditure. Business investment is also picking up as a result of the favourable financing conditions, the need to modernise the capital stock after years of subdued investment and strengthening corporate profitability.
From today’s point of view, there are signs of a stronger global recovery and a pick-up in international trade. The more synchronised economic upswing across regions should further support the euro area recovery.