Eurozone GDP shrinks for first time since 2009

15 Feb 2012 | 09:04
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parisfinancial

Fourth quarter eurozone GDP has come in fractionally ahead of expectations but the 0.3% drop will do little to dismiss predictions of a new recession.

The 0.3% GDP fall for the euro area beat expectations of a 0.4% drop and brought total GDP growth for the eurozone over 2011 as a whole to 1.5%. But the drop represents the eurozone's first quarterly contraction since the second quarter of 2009.

Among individual member states, Italy and the Netherlands fell back into recession after each posted negative growth of 0.7% for Q4 2011, their second successive quarters of contraction.

Both France and Germany posted better than expected figures, however. Economists had expected France to record a 0.2% fall, with German GDP seen as shrinking by 0.3%, but the data showed France grew by 0.2% and German GDP fell by 0.2% over the period.

In France, indicators suggested a contraction in consumer spending and industrial output but an increase in production and investment helped stave off a contraction, according to national statistics office Insee.

Similarly, preliminary data in German said investments - notably in construction - helped boost Q4 GDP, though trade and private consumption dragged on the figures. German Q3 GDP was also revised up from 0.5% to 0.6%.

The figures follow yesterday's monthly ZEW barometer, which revealed German investor confidence has jumped to a 10-month high in February.

Categories: Economics / Markets

Topics: FranceGermany

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