Industrial production in the 17-nation currency zone rose 0.7 percent in June from May, Eurostat, the statistical agency of the European Union, reported from Luxembourg. The agency also revised down the size of the decline in May, to 0.2 percent, rather than the 0.3 percent previously reported.

The data came a day before Eurostat is scheduled to release its first estimate of second-quarter gross domestic product, and expectations of good news were supported by the results of a survey that showed growing confidence in Germany. The ZEW institute, an economic research organization based in Mannheim, said its economic sentiment indicator had risen to 42.0 points, up by 5.7 points from July, and well above its historical average of 23.7 points.

“The euro zone’s recession ended when the snow melted last Easter,” Christian Schulz, an economist at Berenberg Bank in London, wrote in a research note. Having contracted for six straight quarters, he said, the euro zone economy “probably expanded modestly” in the April-June quarter “and will gain further momentum in the second half of the year.”

Ben May, an economist in London with Capital Economics, said the data Tuesday — as well as a small rebound in construction — suggested that the G.D.P. grew 0.2 percent in the second quarter, following a 0.3 percent quarterly decline in the first three months of the year.

Mr. Schulz credited the European Central Bank’s monetary policy, as well as the fading impact of austerity measures. He projected a 0.3 percent expansion in third-quarter G.D.P., followed by 0.4 percent growth in the last quarter.

Even with second-half growth, Eurostat has estimated that the euro zone economy will contract slightly for all of 2013 before expanding 1.2 percent next year.

Still, there is little to celebrate. There are more than 26 million Europeans who cannot find work, and the jobless rate in countries like Greece and Spain is well over 20 percent. Economists do not expect hard-hit countries to bounce back fully for several years.

Growth in Europe is still likely to lag behind that of other developed nations like the United States and Japan, as well as rising giants like China.

June marked the fifth month of the last seven in which industrial production has risen, with the data released Tuesday confirming the findings of a survey last month of European purchasing managers.

Production of consumer durables rose by 4.9 percent in June, while output of capital goods rose by 2.5 percent. Eurostat did not break down the data by product, but consumer durables generally include things like appliances, furniture and cars.

Industrial output in Germany, the largest euro zone economy, rose a strong 2.5 percent in June from May, but France, the No. 2 economy, posted a 1.5 percent decline.

For the European Union as a whole, Eurostat reported a 0.9 percent increase in June production. From a year earlier, industrial production grew 0.3 percent in the euro zone, and 0.4 percent in the overall European Union.

Article source: http://www.nytimes.com/2013/08/14/business/global/industrial-production-lifts-european-economy.html?partner=rss&emc=rss