The EuroZone slides deeper into recession and even Germany slows

08/15/2012 4:01 pm EST


Jim Jubak

Founder and Editor,

Six out of the 17 EuroZone countries are now in recession, as of second quarter data released yesterday by the European Union’s statistics office. The only countries reporting something resembling good news were Germany, where the economy grew by a better than expected 0.3% in the second quarter from the second quarter of 2011, Austria (with 0.2% growth) and the Netherlands (with 0.2% growth.) Finland, which had been in expansion, showed a 0.7% year over year drop in growth in the quarter.

The decline in growth for Italy (down 0.7%), Spain (down 0.4%) and Portugal (down 1.2%) was enough to pull the EuroZone economy as a whole down to a 0.4% decline from the second quarter of 2011.

The worry going forward is that the EuroZone’s two biggest economies will join the recession. France reported flat growth for the quarter, better than the 0.1% contraction that economists had expected. German investor confidence dropped in the most recent reading to the lowest level since December 2011. Industrial production in the EuroZone fell by 0.6% in June from the May level according to data reported today. Output was down 2.1% year over year. Those numbers aren’t good news for the exporting industrial sector of the German economy.
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