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Originally published Tuesday, February 14, 2012 at 5:57 AM

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Eurozone economy shrinks by 0.3 percent in Q4

The 17-nation eurozone economy contracted by 0.3 percent in the final three months of 2011 as many countries slipped back into recession, official figures showed Wednesday, in a clear sign that the impact of Europe's debt crisis has hit every country in the single currency bloc.

The Associated Press

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BRUSSELS —

The 17-nation eurozone economy contracted by 0.3 percent in the final three months of 2011 as many countries slipped back into recession, official figures showed Wednesday, in a clear sign that the impact of Europe's debt crisis has hit every country in the single currency bloc.

The decline - the first since the second quarter of 2009 - came as the debt crisis intensified and threatened to spread to big economies, notably Italy.

The eurozone, however, is not yet in recession as that's only official after two quarters of negative growth - in the third quarter, the eurozone eked out growth of 0.1 percent.

Many eurozone countries are in recession, however, including Italy, the Netherlands and Portugal.

Wednesday's figures from Eurostat, the EU's statistics office, were a little better than most predictions of a 0.4 percent drop.

However, figures earlier showing an unexpected 0.2 percent gain in France and a smaller-than-anticipated 0.2 percent drop in Germany had stoked some expectations that the figure would be even better than forecast.

For 2011 as a whole, the eurozone economy grew by 1.5 percent.

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