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Eurozone economy moves up a gear

Tuesday, April 21, 2015 - 02:05

Germany's key ZEW economic outlook disappoints, but SAP says business software profits are up and Peugeot announces a 10% production hike. Is the 'va va voom' returning to Europe's economy? David Pollard reports.

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Europe's had a rough road in recent years. Here, one firm's trying to make things smoother. French ride-sharing firm BlaBlaCar connects drivers with passengers to split the cost of trips. And has just bought two competitors - adding another five million users. (SOUNDBITE) (French) BLABLACAR USER, ELISE THOMAS, SAYING: ''The train is really expensive and I can't afford to take the train home. So BlaBlaCar is a nice idea.'' Peugeot Citroen, too, is on the move. A year into a major turnaround plan - it says demand is back. And is boosting European production by ten percent - in step with recent market growth. News elsewhere is positive: SAP posting a 15% rise in software profits for the quarter, pay-TV group Sky reporting a 20% hike in profits in nine months. And if there's concern that a rail strike might slow Europe's biggest economic engine, there's no sign of that yet. The influential ZEW institute's current snapshot of Germany came in at a forecast-busting 70.2 points. Even if the ZEW's outlook was slightly weaker. Rabobank's Jane Foley. SOUNDBITE: Jane Foley, Senior Currency Strategist, Rabobank, saying (English): ''The uncertainties as to whether or not Greece will default, whether it will stay in the euro zone system, are probably reflected into the expectations component of that index. But I think we should take a lot of reassurance from the improvement in that current situation of the index. It's gone up far more than any economist would have expected at the start of the year.'' Stocks were climbing back towards all-time highs on the upbeat news. Sentiment already riding high in Europe on a QE pipeline of cheap money. Where asset prices have become unrealistic, they've mostly met with soft, not hard landings, says Foley. SOUNDBITE: Jane Foley, Senior Currency Strategist, Rabobank, saying (English): ''Whilst there is a risk that we could be getting into bubble territory, right now I'm fairly confident that we're not there yet." The party could go on, say analysts. With one caveat: that Greece could yet be the thing to spoil it.

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Eurozone economy moves up a gear

Tuesday, April 21, 2015 - 02:05