European Economy. Quarterly report on the euro area 2007.

Abstract

In 2006 the economic situation brightened substantially. GDP grew by 2.6% last year, up from 1.4% in the year before. This is the best performance since 2000 and clearly above potential growth which means that the output gap has improved significantly. In the last quarter of 2006, growth was balanced, driven by both domestic and external demand. Reflecting the positive growth momentum, the unemployment rate continued to edge down, falling to 7.4% in January 2007, the lowest level since 1993