A potential for a snap election has generated huge interest from abroad but Irish bonds and the euro were left untouched as investors bet the effect on the looming Brexit summit would be limited, writes Eamon Quinn.

Strong household spending, rising state expenditure and higher company investments have consolidated Germany’s role as the eurozone growth engine in the second quarter, although accelerating imports meant growth came in just below expectations.

The cost of borrowing from banks in Ireland could fall further as ECB rates stay low into the next decade, but the jury remains out on whether the period of a low euro exchange rate can last.

The eurozone economy notched up modest growth in the final three months of last year, showing the bloc has little muscle to shrug off the globe’s mounting economic problems.

Confidence in the eurozone’s economy edged up to a new four-year high in August, as rising domestic demand marginally outweighed a worsening view of export prospects and the mood brightened, particularly in France and Spain.

German industrial orders unexpectedly dropped in February, partly because companies got fewer major contracts, after bookings already plunged in January, suggesting manufacturers had a subdued start to 2015 in Europe’s largest economy.

German exports fell sharply in November and industrial output also declined, suggesting Europe’s largest economy ended 2014 on a weak note.

The German economy, Europe’s biggest, returned to modest growth of 0.1% in the third quarter – avoiding a technical recession after contracting slightly in the previous three-month period, official data showed today.

There is still no clarity on whether the ECB will be able to buy tracker mortgages from Irish banks following its latest monthly meeting.

German industrial output posted its biggest monthly increase since March 2012 in July, rising far more than forecast and marking a strong start to the third quarter for a key sector of Europe’s powerhouse economy.

ECB president Mario Draghi will announce an asset-backed securities purchasing programme at Thursday’s monthly meeting instead of unveiling plans for fully fledged quantitative easing.

The eurozone’s flatlining economy took another hit yesterday when data showed German business sentiment sagging for the fourth month running, while a row over the lack of growth led the French government to resign. 

Germany’s faltering economy has cast further doubt over the eurozone’s prospects for recovery this year, with no other big country strong enough to pick up the slack.

German exports posted their biggest fall in nearly a year, in March, and imports also dipped as the crisis in Ukraine and a slowdown in China weighed, narrowing the country’s trade surplus and confirming trade was a drag on growth at the start of 2014.

German business morale surged to its strongest in a year-and-a-half in November, suggesting Europe’s largest economy is gaining steam into the end of the year after growing by a modest 0.3% in the third quarter.

German chancellor Angela Merkel lost no time in approaching her Socialist counterparts to agree a grand coalition government following her resounding success at the polls.

The ECB will not introduce any further interest rate cuts in view of the improving economic environment, according to the Brussels-based chief economist with ING, Carsten Brzeski.

The eurozone’s seven consecutive quarters of economic contraction has been halted by GDP growth of 0.3% in the second quarter of this year.

The latest ZEW index, which measures German business sentiment, fell unexpectedly in July compared with the previous month on the back of lower export figures and the continuing euro crisis.

The ECB president Mario Draghi is highly unlikely to cut the interest rate or announce a big bazooka for SME lending at tomorrow’s monthly meeting, according to senior economist with Brussels-based ING, Carsten Brzeski.

For the sixth month in a row, the NTMA will issue a €500m three-month treasury bill tomorrow.

Germany’s economy crept back into growth at the start of the year but not by enough to stop the eurozone from contracting for a sixth straight quarter, and France slid into recession.

The ECB cut interest rates for the first time in 10 months yesterday and held out the possibility of further action to support the recession-hit eurozone economy.

The ECB will wait until its June meeting to cut interest rates, although a move to boost SME lending could be announced at its May meeting, according to Brussels-based chief economist with ING Bank Carsten Brzeski.

The eurogroup of finance ministers would have to decide whether the ESM is used to recapitalise the Irish banks, but the ECB backs any proposal that breaks the link between banks and sovereign debt, said its president Mario Draghi.

The consensus view is that the ECB will keep the main interest rate on hold today, but its president Mario Draghi may signal the he is looking at unconventional ways of boosting lending to the wider economy.

Europe's financial woes deepened today as its two largest economies reported faltering economies.

ECB president Mario Draghi has signalled that policy makers are concerned that the euro’s strength will hamper their efforts to pull the economy out of recession.

Investors piled into equities sending markets to two-year highs yesterday as most of the major macro-economic risks that threatened to derail the recovery now appear to be receding.

Germany’s economy grew by 0.7% in 2012 – but it shrank in the fourth quarter, government figures showed today.

Europe’s stalled economy will not get more help today from the European Central Bank, which is expected to hold off cutting interest rates as it waits for financial markets to heal so that its already low benchmark rates get through to businesses and consumers.

The ECB has kept interest rates on hold following the latest meeting of the governing council.

Concerns are growing that the debt crisis across the eurozone is weighing on the German economy following the release of the country’s leading confidence indicator, which shows a downward trend for the fifth month.

The eurozone debt crisis has flared dangerously once again.

The main indicator for economic sentiment in Germany has dropped for a third month in a row.

An ECB source has said the Frankfurt-based institution would like to see senior bondholders included in the restructuring of banks as part of the EU bailout of the Spanish banking system.

A Spanish bailout is looking likely, writes Susana Vera, despite the government and the EU dismissing talks of a rescue package

A deal between Greece and the rest of the eurozone to secure a second massive bailout for the debt-laden country was finally delivered today – but analysts warned the “crisis marathon is not over”.

Germany’s economy slipped into reverse in the last quarter of 2011, with gross domestic product falling 0.2%, according to adjusted figures.

The leaders of 23 European countries moved to tie their economies much closer together in a bid to shore up the euro, but failed to get Britain and the four other EU members to join in.

THE eurozone economy grew just 0.2% in the third quarter, as solid growth in Germany and France was dampened by countries at the sharp end of the debt crisis and economists expect a slide into recession by early next year.

London’s leading shares index surged 3% today as investors cheered the long-awaited action plan from European leaders to tackle the region’s debt crisis.