Hong Kong emerges from recession

According to official records, Hong Kong’s economy has left a year-long recession, recording a growth of 3.3% in June’s second quarter. The figures, which were seasonally adjusted, had been higher than forecast by economists.

As a result, the government has increased its growth predictions for 2009. Previously, estimates suggested the economy would contract by 5.5% to 6.5%. Now, the contraction is only predicted to be between 3.5% and 4.5%.

“The GDP data was much better than we expected, partly because the exports were better and partly because of a pick-up in private consumption,” Bank of East Asia’s chief economist, Paul Tang, noted. “Private consumption is being driven up by stock market gains and by the property sector, which started doing well.”

However, government economist Helen Chan warned that “while we are seeing some light at the end of the tunnel, […] the outlook remain highly uncertain because the situations in the United States and Europe are still very weak.”

Spanish economy contracts 1% in second quarter

Official statistics indicate that the economy of Spain, the fourth-largest member of the eurozone, contracted by one percent in the quarter to June. The GDP was 4.1% lower by comparison to this time last year.

However, the rate of the decline was less severe in this quarter than previously, and the government said the figures indicated “relatively better performance.”

The numbers are a contrast with the economies of France and Germany, who both saw their GDPs increase by 0.3% in the same time period.

Dominic Bryant of BNP Paribas commented that “this was a bit disappointing and worse than we expected, since a number of indicators had improved in Spain over the last few months.

“We do expect Spain to do worse than other European countries for a few years. Germany and France don’t have the same imbalances as Spain, which means we expect it to stay weaker for longer,” he added.

Spain’s government says it expects the economy will shrink by 3.6% by the end of the year, but will start growing again in the second half of 2010.

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