Euro zone GDP up 0.7 qq in Q2 vs 0.2 forecast
Bloc bellwether Germany stagnates
Mild recession on cards in H2economists
Inflation jumps to 8.9 in July, above forecast

BRUSSELSFRANKFURT, July 29 Reuters The euro zone economy grew much faster than expected in the second quarter, but economists said it might be the economy39;s last hurrah before everhigher inflation and supply chain problems cause a mild recession in the second half of the year.

The stronger growth came despite stagnation in the bloc39;s biggest economy Germany, where high inflation and fears of a gas crisis triggered by the war in Ukraine have caused consumer and business sentiment to plummet, economists said.

The EU39;s statistics office said euro zone gross domestic product rose 0.7 quarteronquarter in the AprilJune period for a 4.0 yearonyear gain, strongly beating expectations of a 0.2 quarterly and 3.4 annual gain.

Meanwhile, inflation rose to another record high in July and its peak could still be months away, keeping pressure on the European Central Bank to opt for another big interest rate increase in September. 

Consumer price growth in the 19 countries sharing the euro currency accelerated to 8.9 in July from 8.6 a month earlier, far above expectations for 8.6 and well clear of the ECB39;s 2 target, Eurostat said.

The acceleration in economic growth is mainly due to reopening effects and masks underlying weakness due to high inflation and manufacturing problems, ING economist Bert…