Summary
The available information on the external economic background continues to show negative signs. According to the Eurostat flash estimate, the GDP in the Euro Area slowed down in the 4th quarter, from 2.7% to 2.3%, and the same has happened in the UK, USA and Japan. In January 2008, the Euro Area economic sentiment and consumer confidence indicators diminished for the sixth consecutive month.
On the domestic side, according to the first estimate, the GDP increased, in year-on-year terms, 2.0% in the 4th quarter of 2007, more 0.3 p.p than in the 3rd quarter. This evolution reflected a stronger domestic demand, mainly due to investment, while the external demand negative contribution increased, mainly as a result of the exports. The acceleration of investment was mainly determined by the contribution of the construction component and by the intense growth of transport material. The economic activity indicator recovered in the 4th quarter, although showing a stabilization in December. The turnover and production indices revealed higher year-on-year growth rates in the 4th quarter and in December. However, the economic climate indicator diminished slightly in the 4th quarter and in January 2008, reaching the lowest value of the last ten months.
In the 4th quarter, employment rose 0.9% compared to the same quarter of 2006, more 0.7 p.p. than in the previous quarter. The unemployment rate in the 4th quarter was 7.8%, 0.4 p.p. less than in the 4th quarter of 2006.
Year-on-year inflation accelerated, from 2.7% in December to 2.9% in January, due to the services price index.