Eurozone plunges into recession
The euro zone economy entered a technical recession during the first three months of the year, according to data released by the EU statistics agency Eurostat.
Data released on Thursday showed it contracted by 0.1% for the second straight quarter.
Downward revised growth forecasts
Eurostat has revised down an earlier forecast that had seen slight growth after Germany said last month that it had slipped into recession.
Inflation and higher interest rates reduce demand in countries that use the euro as their currency.
The latest figures also highlight the impact of the loss of Russian natural gas, which has sent energy prices soaring.
The worse-than-expected numbers cast doubt on more optimistic forecasts for the remainder of 2023.
In May, the European Commission forecast growth for the remainder of the year in the euro zone.
Economic development in Eurozone countries varied with Luxembourg achieving the highest quarterly growth at 2.0% and Portugal at 1.6%.
Sharp declines were seen in Ireland, down 4.6%, Lithuania down 2.1% and Germany’s quarterly GDP down 0.3%.
Eurostat’s unemployment figures for March, however, show that European labor markets have weathered the economic barrage.
Unemployment is at its lowest level since the creation of the euro in 1999, reaching 6.5% in March.
Source: DW
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