BERLIN, Aug. 13 (UPI) -- The strongest economic growth in Germany in two decades powered Europe's economic recovery ahead of the United States.
The eurozone economy grew by 1 percent in the second quarter, its biggest quarterly expansion since the second quarter of 2006, the European Union's Eurostat statistics agency said Friday.
Growth in the 16 eurozone countries was slightly weaker than the 1.1 percent expansion in Britain, but stronger than in the United States, where the gross domestic product grew by only 0.6 percent, Eurostat said.
The eurozone surged to the top on the back of Germany, Europe's economic powerhouse.
Beating all analyst forecasts, Germany's economy in the second quarter of 2010 grew by 2.2 percent compared to the first three months of the year, its fastest growth in two decades.
In comparison with the same time last year, Germany's economy grew by 4.1 percent, the Federal Statistical Office said Friday.
"Reunified Germany has never seen such quarterly growth before," the office said in a statement.
The German government has forecast 1.4 percent growth for this year but Economy Minister Rainer Bruederle said Friday an expansion of "well over 2 percent" is now possible.
"One cannot yet speak of an economic miracle, but we are experiencing an XL upswing at the moment," Bruederle told reporters.
The XL upswing is thanks mainly to surging exports to China and other rapidly growing economies --German car giant BMW, for example, saw its sales to China explode by 82 percent in July. Overall, eurozone exports to China increased by 43 percent in the five months through May, Eurostat said.
European products are in demand also because of the relatively cheap euro. The common currency is trading low due to fears that some of the southern European economies -- including Greece, Spain, Portugal and Italy -- are still in the midst of a crisis.
Greece, which was forced to ask for an EU bailout package this year, saw its economy contract by 1.5 percent, and Spain's 0.2 percent GDP growth was less than expected. At least France had some good news to announce: French Finance Minister Christine Lagarde said the country's economy grew by 0.6 percent, double the rate expected.
Last month, it was announced that the overwhelming majority of European banks passed wide-ranging stress tests to see whether they would weather another credit crunch, boosting investor confidence.
