We start this week's Briefing with a question. In which region or country – the US, Japan, euro area or the UK – have expectations for GDP growth remained most robust over the last year? A clue: it saw the fastest GDP growth in the first quarter of this year.
The answer is the euro area. The outlook for the US, Japanese and UK economies has deteriorated markedly in the last year while euro area growth expectations have seen only modest downgrades.
In the last four years the US and the UK economies have comfortably outpaced a stuttering euro area. But this year, with growth in the US and UK cooling, and euro area activity nudging up, GDP growth in the three regions is likely to be roughly the same, at around the 1.8% mark.
Euro area growth is hardly stellar. But there has been a modest recovery, one which seems to have been eclipsed in the news by political uncertainties, the migration crisis and deflation risks.
So where has Europe's low-key recovery come from?
The labour market has turned up in the last couple of years, with the previously weakest economies including Italy, Spain and Ireland seeing some of the largest declines in unemployment. Europe has a reputation for high unemployment, but the reverse is true of its largest economy. At 4.3% Germany's unemployment rate is lower than that in the US or the UK and at its lowest level in more than 25 years.
Falling inflation has boosted consumer spending power. In Germany, real earnings are rising by 2.0% a year, close to previous cyclical peaks.
The result is that consumers are spending more. Confidence about splashing out on "big ticket" items such as TVs and furniture is close to levels last seen in the early 2000s. Car sales are up by almost 10% in the last year (the Italians seem to have thrown caution to the wind; car sales there have risen 19% in the last year).
The European Central Bank's cheap money policies are having an effect. Credit demand from consumers and corporates has revived since the nadir in 2011. In the last year unsecured borrowing by euro area consumers has risen by 6.6%, a faster rate than in the UK. Easy monetary policy is one factor behind the decline in the value of the euro which has offered some support for the region's exporters.
Recovery in the previously recession-stricken periphery of the euro area has been an additional tailwind. Spain and Ireland have seen strong recoveries and are at the top of the European growth league. But this is an unequal recovery: the return to growth in Italy and Portugal has been muted and Greece remains in recession.
As Britain's EU referendum approaches the euro area economy seems to be narrowing the growth gap with the UK. Deloitte's survey of Chief Financial Officers across Europe shows that perceptions of uncertainty in the UK are higher than in the euro area. Corporate risk appetite has fallen sharply in the UK and is well below euro area levels. While UK CFOs expect to reduce capital spending and employment euro area CFOs expect to raise them. Much of this gap may be due to Brexit uncertainties. But whatever the cause it seems likely that the euro area will grow faster than the UK in the first half of 2016.
The euro area recovery is fragile and risks abound. Brexit would be a political earthquake for the EU. Inflation is worryingly low. Greece needs another bailout; Europe's borders and its monetary union need fixing.
Still, credit where credit is due. In an uncertain world the euro area's performance in the last year has not been bad. Or, as my music teacher put it in a school report, "Not unsatisfactory relative to expectations".
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