Eurozone recession deepens
(BRUSSELS) - The 17-nation eurozone sank further into recession in the last three months of 2012 as the debt crisis continued to exact a heavy price, official data showed Wednesday.
The eurozone economy shrank 0.6 percent in the fourth quarter of 2012 compared with the third quarter when it contracted 0.1 percent, the Eurostat data agency said, confirming initial estimates given in February.
For the full 27-member European Union, the economy was 0.5 percent smaller in the fourth quarter after a marginal gain of 0.1 percent in the third, Eurostat said.
A recession is counted as two consecutive quarterly economic contractions.
Compared with fourth quarter 2011, the eurozone economy was down 0.9 percent and the EU 27 off 0.6 percent.
Among the major economies, European powerhouse Germany shrank 0.6 percent in the fourth quarter after a gain of 0.2 percent in the third and France slipped 0.3 percent after growth of 0.1 percent.
Non-euro Britain lost 0.3 percent after sharp growth of 1.0 percent in the third quarter, boosted by the London Olympics.
Among the fourth quarter best performers were Estonia, which grew 0.9 percent and Lithuania, up 0.7 percent, while bailed-out Portugal was the weakest, with its economy shrinking 1.8 percent.
Eurostat said that for 2012 as a whole, the eurozone economy contracted 0.6 percent and the EU 0.3 percent.
Data so far for 2013 suggests the European economy is stabilising after a very bad 2012 but the outlook remains weak and uncertain.
Howard Archer of IHS Global Insight said the eurozone recession may have deepened in the fourth quarter but it should mark the bottom of the slump.
"The good news is that the fourth quarter of 2012 almost certainly marked the low point for eurozone economic activity as a significant easing of eurozone sovereign debt tensions underpinned by the European Central Bank's policy actions" has boosted confidence and the markets, Archer said in a statement.
"The bad news is that real economic activity is yet to show major improvement in many countries and it looks highly likely that growth will remain a major struggle for the eurozone for some time to come."