The US$10 trillion economy will expand about 0.7 percent in the current and next two quarters, after growing 0.6 percent in the first quarter, the commission said yesterday in Brussels. The economy hasn't grown more than 0.7 percent in three consecutive quarters since the period ended June 2000.

    Manufacturing in the region unexpectedly accelerated at the fastest pace in almost six years in May, a survey published by NTC Economics Ltd showed, the sixth indicator this week of a pickup in economic expansion. The European Central Bank is poised to raise interest rates for a third time in six months this month to tame the resulting inflation.

    "All the data is pretty supportive of the ECB continuing to hike rates," said Dominic White, an economist at ABN Amro in London. "They all point to an improving growth situation in the euro area."

    The central bank raised the rate to 2.5 percent in two quarter-point steps since December as faster economic growth allowed companies to pass on higher oil costs.

    First-quarter growth was driven by a 0.7 percent increase in consumer spending, up from a 0.1 percent increase in the prior quarter the European Union's statistics office in Luxembourg said. Exports increased 3.1 percent, after rising a healthy 0.7 percent in the previous quarter.

    (Source: Shanghai Daily)