Eurozone GDP Shrinks 0.1% in Q3 and into Recession

According to data released on Thursday by the European Union Statistical Office, Eurostat, the Gross Domestic Product (GDP) in the eurozone fell 0.1% in the third quarter of the year compared to the previous three months, when the fall was 0.2%. Spain shrank by 0.3% in the third quarter due to a drop in consumption.

With these figures the economy of the region accumulates two consecutive quarters of decline, and thus enters into a technical recession.

Compared to the same period last year, GDP fell by 0.6%, after the April-June decline of 0.4% year-on-year. El Economista reported that these figures are in line with expectations of analysts surveyed by Bloomberg.

In the whole of the EU, the economic activity in the third quarter registered an increase of 0.1% over the previous three months, when it fell by two tenths, after stagnating in the first quarter of the year and falling by 0.3% in the last quarter of 2011. In annual terms, the decline was 0.4%.

Among the eurozone countries, it was noted that German GDP grew by 0.2% in the third quarter, with France experiencing the same increase. However, for the German economy this reading represents a slowing of growth, while for the French it is the equivalent of avoiding falling into recession.

According to the latest data, the other economies capable of growth are those of Estonia (+1.7%), Slovakia (+0.6%) and Finland (+0.3%).

In contrast, the Netherlands recorded the biggest quarterly drop in activity (-1.1%), ahead of Portugal (-0.8%), Cyprus (-0.5%), Spain (-0.3%), Italy (-0.2%) and Austria (-0.1%).