Economic recovery in the Eurozone slows in the third quarter
15 Nov 2013
Eurozone growth slumped to just 0.1% in the July to September period, after experiencing its first expansion in 18 months in the previous quarter.
Italy’s continuing recession and declining French output are both thought to have contributed to the slowing of the overall eurozone economy. Italy has now entered its ninth quarter of recession since the summer of 2011 and its GDP declined by 0.1% in the third quarter. In France, a decline in exports and business investment failed to counterbalance strong consumer spending, resulting in a 0.1% decline in GDP.
A few countries did experience economic growth in the third period including Austria, Finland and the Netherlands.
Meanwhile, German growth fell from 0.7% to 0.3% from the second to third quarter, although several analysts explained the fall as the German economy returning to its expected annualised rate of 1.2% a year.
Europe’s Central Bank cut interest rates last week in an attempt to lift growth, a move that was welcomed in most eurozone capitals. However several German officials disagreed with the move, saying it was unnecessary and undermined the strength of the single currency union.
Chris Williamson, chief European economist at financial data provider Markit, said that the recovery ‘remained on track at the start of the fourth quarter, although the upturn continues to look both fragile and weak’.