In the second quarter of 2010, in both the euro area (EA16) and the EU27, the seasonally adjusted business investment rate and profit share grew compared with the previous quarter. In the euro area, stocks remained almost unchanged after five quarters of destocking.

These data come from a detailed set of quarterly European sector accounts released by Eurostat, the statistical office of the European Union, and the European Central Bank (ECB).

Business investment rate up in both zones, but still at low levels

In the second quarter of 2010, the seasonally adjusted gross investment rate of non-financial corporations was 19.9% in the EU27, compared with 19.6% in the first quarter of 2010. In the euro area, the investment rate was 20.4% in the second quarter of 2010, compared with 20.1% in the previous quarter.

In the euro area, the gross investment rate of non-financial corporations increased due to gross fixed capital formation (investment) increasing faster (+2.7%) than value added (+1.2%). Stocks of materials, supplies and finished goods remained almost unchanged after five quarters of destocking.

Business profit share continues to recover in both zones

In the EU27, the gross profit share of non-financial corporations was 37.7% in the second quarter of 2010, compared with 37.2% in the first quarter of 2010. In the euro area, the profit share was 38.3% in the second quarter of 2010, compared with 38.0% in the previous quarter.

In the euro area, the increase in gross profit share of non-financial corporations was due to value added increasing faster (+1.2%) than compensation of employees (wages) plus taxes less subsidies on production (+0.7%).