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BREAKING NEWS

Euro zone still in recession

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Euro zone still in recession

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The 16 countries of the euro zone stayed in recession between April and June.

However, figures from the European Union statistics office Eurostat have confirmed its earlier estimate that the contraction was smaller than in the previous quarter at just 0.1 percent compared with a 2.5 percent drop between January and March. Second-quarter GDP was 4.7 percent lower than a year earlier, after a 4.9 percent annual decline in the first quarter. Higher household spending supported the region’s economy in the second quarter; the negative factors were decreased private investment and a plunge in inventories. Those depleted inventories will now have to be rebuilt which should boost production and the fact that the global economy is showing some signs of revival is likely to increase demand for euro zone exports. Economists believe the relatively small fall between April and June means the euro zone could emerge from recession in the third quarter especially as its two biggest economies, Germany and France, returned to growth in the period.