In the spring of 2004, the euro-area economy is on the road of recovery. While the previous stagnation has been overcome, one cannot speak of a true upswing. In fact, real GDP rose by a little less than 1½ percent in the second half of last year. Capacity utilization has not yet increased which is in contrast to the recent development of other major industrial countries. The weak spot has been private consumption which has only stagnated so far. However, fixed investment went up for the first time in 2½ years. A strong support for the upturn came from abroad. Since production in the rest of the world has risen sharply, exports have shown a strong performance although the euro appreciation has had a negative impact.