Industrial output expand on big rise in Germany
Structural issues not resolved
ZEW sentiment index improved
Bank lending recovering

FRANKFURT, Oct 15 Reuters The euro zone economy showed some signs of life on Tuesday with a raft of indicators pointing to lukewarm but still positive growth for a bloc that has been skirting a recession for over a year.

Industrial output expanded and lending demand rose, while expectations in a key German sentiment survey also increased more than predicted, offering some reassurance after key indicators tended to underperform expectations over the past month.

The figures are likely to reinforce bets that the bloc is still growing, even if at the slowest possible pace, but are unlikely to prevent the European Central Bank from delivering an interest rate cut, which is now almost fully priced in.

Industrial production rose by 1.8 on the month in August, a touch ahead of expectations, and was up 0.1 from a year earlier, driven by rising demand for capital and durable consumer goods, Eurostat said.

Output in Germany, the bloc39;s biggest economy, surged more than 3 on the month, the biggest rise among the bloc39;s larger economies, even if the annualised figure was still deeply negative.

High energy costs, lukewarm demand from China and increased competition from other producers have weakened Germany39;s industry in recent years, prompting some soul searching over the viability of the country39;s industryfocused economic model….