The eurozone economy grew at its fastest rate in a decade in 2017, according to the latest Eurostat estimate. The European statistics agency said last week that its preliminary flash estimate of gross domestic product of the countries that participate in the euro currency grew by 2.5 per cent in the last calendar year. This is the most rapid rate of growth since a 3.4 per cent expansion in 2007, the year before the global financial crisis broke out.

The eurozone is in the midst of a broad cyclical expansion, buoyed by robust global demand, after years of economic stagnation and rolling sovereign debt crises. It remains to be seen, however, whether the stronger euro currency will offset the effects of improving external demand.

Meanwhile, as expected, the Federal Reserve (Fed) last week voted to leave its benchmark interest rate unchanged, in a range between 1.25 and 1.5 per cent. The statement issued after the meeting hinted that the Fed will increase the benchmark rate at its next meeting, which is scheduled for late March, thanks to an improving economy and signs of incipient inflation. “Inflation on a 12-month basis is expected to move up this year and to stabilise around the committee’s two per cent objective over the medium term,” the Fed statement said.

Finally, confidence among consumers in the US rebounded more than economists anticipated in January, after a surprise decline the previous month. The Conference Board’s measure of consumer confidence rose to 125.4 in January, higher than the 123.1 forecasted by economists polled by Reuters. The measure had declined to 122.1 in the month of December. The key index rose to 129.5 in November, the highest reading since the index reached 132.6 in November 2000.

Economists had expected the consumer confidence index to rise to 123.6 from the 122.1 originally reported for the previous month.

This report was compiled by Bank of Valletta for general information purposes only.