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Southern growth spurt creates two-speed eurozone economy

Andrew Kenningham, chief European economist at Capital Economics, said the output of southern Europe’s four biggest countries was “now more than 5 per cent bigger” than Germany’s. 

“The ‘peripherals’ were 20 per cent bigger [than Germany] before the global financial crisis,” Kenningham added.

“Unlike during much of the last decade, the southern economies are not obviously in need of looser monetary policy than the core,” said Kenningham. “If anything, the opposite may be true.”

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