Germany, Europe\u2019s largest economy, grew by 0.3% as we reported earlier, while France, the second-biggest economy, showed zero growth, and Italy, the No. 3, expanded by 0.2%, and Spain, the fourth-largest economy, managed 0.6% growth.<\/p>\n
Among the member states for which first-quarter data is available, Finland (+0.9%) recorded the highest increase, followed by Hungary (+0.8%), Estonia and Spain (both +0.6%).<\/p>\n
Declines were recorded in Ireland (-2.0%), Lithuania (-0.4%) and Sweden (-0.2%).<\/p>\n
Separate data showed inflation rose to 3% this month, from 2.6% in March.<\/p>\n
Energy is estimated to have the highest annual rate in April (10.9%, compared with 5.1% in March), followed by services (3.0%, compared with 3.2% in March), food, alcohol & tobacco (2.5%, compared with 2.4% in March) and non-energy industrial goods (0.8%, compared with 0.5% in March).<\/p>\n
Share<\/a><\/p>\n Updated at\u00a005.16 EDT<\/p>\n China\u2019s factories increased production for a second month in April to ship goods early to buyers worried the Iran war will drive up costs, with new export orders at their highest level in two years.<\/p>\n The official purchasing managers\u2019 index for manufacturing dipped to 50.3 from 50.4 in March, but held above the 50 mark that separates growth from contraction. It was better than economists had expected.<\/p>\n Teh sub-index for new export orders rose to 50.3, the highest since April 2024, from 49.1 in March.<\/p>\n Zhiwei Zhang, chief economist at Hong Kong-based Pinpoint Asset Management, told Reuters:<\/p>\n double quotation markIt will be interesting to see if the official trade data confirm the resilience of exporters in coming months.<\/p>\n The outlook for the export sector is very important for China\u2019s economy, as domestic demand has been weak.<\/p>\n Share<\/a><\/p>\n Updated at\u00a005.05 EDT<\/p>\n German economy surprises with 0.3% growth in first quarter<\/p>\n Germany\u2019s economy, Europe\u2019s largest, surprised with 0.3% growth in the first three months of the year, defying the adverse impact of the Iran war \u2013 for now at least.<\/p>\n This was faster than the 0.2% growth seen in the fourth quarter of last year, according to official figures<\/a>. This was revised down from 0.3%.<\/p>\n The Federal Statistical Office (Destatis) reported that both household and government spending in the first quarter were higher than in the previous quarter, while exports also rose. More details will be released next month.<\/p>\n Carsten Brzeski, global head of macro at ING, said:<\/p>\n double quotation markAlmost exactly one year after the new German government \u2013 under chancellor Friedrich Merz \u2013 came into office, today\u2019s data suggests that the German economy is better than its reputation implies.<\/p>\n However, it would be risky to assume that today\u2019s performance can simply be continued. The war in the Middle East and soaring energy prices, combined with a lack of structural reform and clear strategy for how to restore competitiveness, do not bode well for Germany\u2019s growth outlook. Judging from the latest sentiment indicators, the signs of a recovery on the back of fiscal stimulus, particularly in defence and infrastructure, have started to fade away.<\/p>\n Soaring energy prices have again exposed the fact that Germany is one of Europe\u2019s largest net importers of energy. Some 6% of its oil imports come from countries in the Middle East. The so-called energy-intensive industries in Germany account for some 17% of industrial gross value added and employ just under one million people. With the war in the Middle East now gradually shifting from a pure energy price shock towards an energy supply and broader supply chain shock, the German economy is once again at the centre of an exogenous, global, disruption.<\/p>\n An underwater drone at the German Navy base presents capabilities and applications of mine countermeasures in Kiel, on 23 April. Photograph: Fabian Bimmer\/Reuters<\/p>\n But, he added:<\/p>\n double quotation markEven if fears of another year of stagnation have returned, it should be clear that the planned investments in defence and infrastructure are still on track and should support the economy this year and beyond. The fiscal impulse is real, it just needs time to reach the real economy.<\/p>\n Share<\/a>DCC shares tumble after Irish energy distributor rejects private equity takeover approach<\/p>\n The Irish energy distributor DCC has rejected a \u00a34.95bn takeover proposal from US private equity groups, saying it undervalued the company.<\/p>\n Shares in the London-listed company, which is based in Dublin, fell 5.1% to \u00a355.80.<\/p>\n The cash proposal of \u00a358 a share from KKR and Energy Capital Partners represented a premium of 8% to DCC\u2019s closing price before the offer was made public on Wednesday.<\/p>\n Under UK takeover rules, the consortium has until 10 June to make a firm offer or walk away. It is the latest private equity pursuit of a UK-listed company, with bidders attracted by British and Irish firms\u2019 comparatively lower valuations.<\/p>\n Other FTSE-100 companies that have been taken over or pursued in the past few months include the insurer Beazley, the investment company Schroders and the product testing company Intertek.<\/p>\n Beazley, which specialises in insuring against cyber-attacks that also covers fine art and luxury yachts, in early February agreed to be taken over by bigger Swiss rival <\/a>Zurich<\/a>. Not long after, Schroders succumbed to a takeover by the US investor Nuveen<\/a>, which ends two centuries of family ownership of the historic British asset management group \u2013 but will create one of the world\u2019s biggest fund managers.<\/p>\n Intertek is being pursued by the Swedish investment company EQT, which is working on an improved proposal, according to Bloomberg News.<\/p>\n DCC, which distributes liquid gas, biofuels, and renewable energy to businesses and households, has been simplifying its operations to focus on its core energy business, having offloaded its healthcare and technology assets.<\/p>\n Analysts at RBC Capital Markets said:<\/p>\n double quotation markWe think there is a good chance that a deal happens, but are not convinced it will be much more than 10% ahead of the current price.<\/p>\n Share<\/a><\/p>\n Updated at\u00a004.31 EDT<\/p>\n In Germany, unemployment rose more than expected in April, above the 3 million mark.<\/p>\n The jobless figure, which is adjusted for seasonal effects, increased by 20,000, according to offical figures. Economists had expected a rise of 4,000.<\/p>\n Andrea Nahles, head of the labour office, said:<\/p>\n double quotation markThere is still no sign of a turnaround in the labour market. The spring upturn remains weak in April as well.<\/p>\n Share<\/a>Air France-KLM cuts capacity forecasts, though summer travel demand remains strong<\/p>\n Air France-KLM has reported a smaller first-quarter loss than expected, but is scaling back capacity because of the US-Israeli war with Iran and soaring jet fuel costs.<\/p>\n The Franco-Dutch carrier expects its fuel bill to rise by $2.4bn this year. Capacity (i.e. more seats) will now increase by 2% to 4% this year, rather than 3% to 5% as previously planned.<\/p>\n Other European airlines, including easyJet and Tui, have also revised their outlooks, and expect to feel the impact of the closure of the strait of Hormuz, which has sent energy prices soaring, more acutely in the coming months.<\/p>\n Air France-KLM chief executive Ben Smith said:<\/p>\n double quotation markWhile fuel price increases are not yet reflected in the results we present today, they are expected to weigh on the coming quarters.<\/p>\n The company said it is limiting discretionary spending, including travel expenses, and has frozen hiring for non-operational staff, while continuing to recruit for operational jobs such as mechanics.<\/p>\n A low-cost Air France subsidiary Transavia plane flies over Nantes, western France. Photograph: Lo\u00efc Venance\/AFP\/Getty Images<\/p>\n The group said its fuel hedging strategy remains in place and it is already 33% hedged for 2027.<\/p>\n However, it also said summer travel demand remains strong, with European destinations such as Italy and Spain popular, as travel to parts of the Middle East remains constrained.<\/p>\n It said it had seen an initial boost after the Iran war broke out as more people booked flights to Asia, but plans to expand its long-haul capacity gradually as people are postponing travel plans or booking closer to the date of travel.<\/p>\n Air France-KLM reported a first-quarter operating loss of \u20ac27m, a \u20ac301m improvement over last year.<\/p>\n Share<\/a>French economy shows zero growth in Q1; Spanish GDP slows<\/p>\n France\u2019s economy did not grow at all during the first quarter, with households spending less and a slump in exports.<\/p>\n GDP was unchanged between January and March, after 0.2% growth in the fourth quarter, according to figures from the French statistics office Inse<\/a>e.<\/p>\n Household consumption declined slightly (-0.1% after +0.4%), and investment fell back (-0.4% after +0.3%). Overall, the contribution of domestic demand (excluding inventories) to GDP growth was zero this quarter, after it added 0.4 points to fourth-quarter GDP.<\/p>\n The contribution of foreign trade to growth was strongly negative this quarter (-0.7 points after +0.6 points): exports fell sharply (-3.8% after +0.8%), while imports declined again (-1.7% after -0.8%).<\/p>\n Total production, of goods and services, was once again sluggish, rising by 0.1%, after a 0.2% gain in the previous quarter.<\/p>\n Meanwhile, Spain\u2019s economic growth slowed to 0.6% in the first quarter from 0.8% expansion in the previous quarter, preliminary data from the National Statistics Institute showed. However, this was slightly better than expected.<\/p>\n Spain\u2019s economy has been one of the top performers in Europe, in part thanks to record tourist numbers, and grew 2.8% last year.<\/p>\n The Spanish government still expects the economy to grow 2.2% this year, although it said earlier this week that uncertainty triggered by the US-Israeli war on Iran could affect the forecast.<\/p>\n Share<\/a>Whitbread to cut 3,800 jobs Premier Inn owner Whitbread<\/a> is to cut about 3,800 jobs in the UK and Ireland as it resets its five-year business strategy, after tax rises and pressure from a US activist investor<\/a>.<\/p>\n The cuts will affected about 12% of Whitbread\u2019s 30,000-strong workforce in the UK and Ireland working in its Beefeater and Brewers Fayre restaurants, which are usually located next to or inside Premier Inn hotels. The company said consultations with affected employees would begin immediately.<\/p>\n Whitbread said it expected to retain a \u201csignificant proportion\u201d of those affected and would try to find alternative roles for them, given it hires about 15,000 people each year.<\/p>\n Whitbread was one of the biggest fallers on the FTSE 100, down 4.4%.<\/p>\n The cuts come after Whitbread began a fresh review of its business in November, a year after it first announced its five-year plan, after it was hit by higher costs in the chancellor\u2019s budget.<\/p>\n Beefeater restaurant in England. Photograph: Peter Jordan\/Alamy<\/p>\n Britain\u2019s largest hotel operator had already been in the process of converting some of its underperforming Beefeater and Brewers Fayre restaurants, usually located next to or inside its Premier Inn hotels, into hotel rooms.<\/p>\n Whitbread warned after Rachel Reeves\u2019s 2025 budget that tax changes would cost it an additional \u00a350m this year, amid changes to the way business rates are calculated. This came hot on the heels of an earlier cost squeeze<\/a> due to higher wage bills and rising food prices.<\/p>\n Whitbread\u2019s new strategy means it will become a pure hotel business, about seven years after it sold the Costa Coffee chain<\/a> to soft drinks giant Coca-Cola in a near-\u00a34bn deal.<\/p>\n This means that as it stands the Beefeater restaurant brand – established in 1974 in known for serving steaks and classic pub dishes \u2013 will disappear from UK high streets.<\/p>\n Share<\/a><\/p>\n Updated at\u00a003.48 EDT<\/p>\n Introduction: Bank of England expected to hold interest rates as it assesses fallout from Iran war<\/p>\n Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.<\/p>\n The Bank of England<\/a> is expected to keep interest rates on hold at noon, as policymakers assess the economic fallout from the Iran war.<\/p>\n Economists will be looking for any clues on future rate policy in the statement and the subsequent press conference. The nine-member rate-setting panel, led by central bank governor Andrew Bailey, could hint at rate hikes in the months ahead if the conflict in the Middle East \u2014 where a shaky ceasefire is in place \u2014 drives inflation higher.<\/p>\n For now, the monetary policy committee is expected to keep the bank\u2019s main rate at 3.75%, while one or two members could vote for a quarter-point hike as a preemptive move to ward off higher inflation.<\/p>\n Before the US and Israel began their attacks on Iran on 28 February, the central bank had been expected to cut borrowing costs this year, as inflation was predicted to fall back toward its 2% target during the spring. The war has since upended the bank\u2019s predictions.<\/p>\n Sandra Horsfield, an economist at Investec, said the \u201crepercussions of the conflict are still keenly felt and uncertainty about how the situation could evolve also remains high\u201d.<\/p>\n![\"Joanna](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/04\/Joanna_Partridge,_L.png\")
Joanna Partridge<\/p>\n