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To: yard_man who wrote (169061)	5/30/2002 1:05:33 PM
From: Haim R. Branisteanu	Respond to of 436258

EU Cuts 2Q Euro-12 GDP Forecast 0.1 Pct Pt To +0.3-0.6% ========================================================= Euro-Zone GDP Forecast* ! ! 3Q 2Q !Surprise: No ! on qtr +0.7%-1.0% +0.3%-0.6%!Trend: Up ! !Median:2Q +0.6% ! released by E.U. Commission !Median:3Q +0.8% ! ! ! ! ! 1Q '01 Preliminary GDP ! ! 1Q '02 4Q '01 ! ! on qtr +0.2% -0.2% !Surprise: Yes ! on yr +0.1% +0.6% !Median:+0.3% on qtr ! !Median:+0.4% on yr ! ! ! *released by Eurostat ! ! ========================================================= BRUSSELS (Dow Jones)--The European Union Commission Thursday revised down by 0.1 percentage point its forecast for euro-zone second-quarter economic growth, but said it expected significant acceleration in the third quarter. Predictions for gross domestic product growth were decreased to between 0.3%- 0.6%. The Commission's forecast appears less bullish than three independent economists contacted by Dow Jones Newswires, who predict second-quarter growth not coming in below 0.6%. The downward revision follows a worse than previously expected fourth quarter of 2001 and slow progress in the retail sector, the Commission said. Also, first-quarter growth was 0.2% compared to the previous quarter, according to Eurostat. That's at the lower end of the Commission's own forecast. But the outlook for the third quarter is brightening. GDP growth is seen coming in between 0.7% and 1%. "The growth acceleration stems mainly from the international environment and the eased monetary conditions," the Commission said. Economists say performance has been erratic across the zone. While domestic demand is strong in France and Spain, German consumers remain hesitant and almost all its growth has come from exports. But economists agree with the Commission forecast of a recovery gathering pace in the second and third quarter of 2002. As evidence, they point to rising confidence measured by Germany's IFO, France's INSEE and Belgium's Business Sentiment data. For the entire E.U., Eurostat said GDP grew by 0.2% in the first quarter of 2002. In the breakdown by sectors, Eurostat said household consumption fell 0.2% in the first quarter of 2002 over the previous quarter. Exports rose 0.9% and imports fell 1.1% in the first quarter. As a comparison, GDP in the U.S. rose by 1.4% during the first quarter of 2001. The euro zone comprises the countries of the European Union minus Denmark, Sweden and the U.K. Additional information can be found at the E.U. Commission Web site: www.europa.eu.int/comm/economy_finance/indicators Additional data can be found at Eurostat's Web site: www.europa.eu.int/en/comm/eurostat. -By Daniel Schwammental, Dow Jones Newswires; +322 285 0131; daniel.schwammenthal@dowjones.com