Current location:Culture Capsule news portal > politics
Eurozone economy on brink of recession
Culture Capsule news portal2024-05-21 13:31:59【politics】8People have gathered around
IntroductionA symphony of light consisting of bars, lines and circles in blue and yellow, the colors of the Euro
A symphony of light consisting of bars, lines and circles in blue and yellow, the colors of the European Union, illuminates the south facade of the European Central Bank (ECB) headquarters in Frankfurt, Germany, Dec 30, 2021. [Photo/Agencies]
A lack of economic growth in three out of the last four quarters has left the eurozone heading into winter on the brink of a recession.
Newly released figures showed a worse-than-expected performance for the third quarter of the year, where the economy shrank by 0.1 percent, despite the rate of inflation having fallen by a larger than anticipated amount, from 4.3 percent in September to 2.9 percent in October.
"A drop in eurozone GDP keeps a small technical recession in the second half of 2023 a realistic prospect," Bert Colijn, senior eurozone economist at ING bank, said. "With inflation falling faster than expected, the debate within the European Central Bank's governing council is set to turn more dovish, but don't expect rate cuts any time soon."
Germany, the economic heart of the continent which so often sets the tone for the fortunes of its neighbors, saw a 0.1 percent economic contraction, while Italy's remained unchanged. France grew by just 0.1 percent and Spain recorded 0.3 percent growth.
Latvia and Belgium saw the biggest growth in the bloc, although moderate figures, while Ireland suffered the sharpest contraction, with a reduction of 1.8 percent.
"The big picture is that the eurozone is struggling," Jack Allen-Reynolds, deputy chief eurozone economist at Capital Economics, wrote in a note quoted by CNN. "It has only grown by 0.1 percent over the past year, and the timeliest business surveys consistently point to activity declining at the start of (the fourth quarter)."
In September, the European Central Bank, or ECB, put up interest rates for a 10th consecutive time, with the deposit rate reaching 4 percent, the highest rate since the launch of the euro in 1999.
This was a move designed to bring down inflation, with ECB President Christine Lagarde saying at the time that the bank's governing council "considers that the key ECB interest rates have reached levels that, maintained for a sufficiently long duration, will make a substantial contribution to the timely return of inflation to the target".
The latest larger-than-expected fall in inflation is an encouraging sign, but the run of successive interest rate rises has had a damaging impact on growth.
Salomon Fiedler, an economist at Berenberg Bank, told The Daily Telegraph newspaper that the latest fall suggested the ECB was "almost certainly done with its rate hike cycle", but Tomas Dvorak, a senior economist at Oxford Economics, said the full impact on the growth of higher interest rates had not yet been felt.
"The eurozone is in for a period of economic stagnation, with growth unlikely to return until real income growth turns sufficiently positive and the peak impact of monetary tightening has passed," he warned.
Address of this article:http://samoa.highlanderdistrict.org/content-29f099893.html
Very good!(984)
Related articles
- California congressman urges closer consultation with tribes on offshore wind
- Ricky Stenhouse punching Kyle Busch could lead to suspension
- Cruise worker 'murders newborn son on board ship': Shocked co
- Jon Wysocki dead at 53: Staind drummer passes away
- Devout Christian doctor, 68, who punched dementia
- Shooting injures 2 at Missouri high school graduation ceremony
- Adams, Reyna, Turner, Ream are US concerns ahead of Copa America
- Nadal returns to Roland Garros to practice amid doubts over fitness and form
- Young Boys seals 6th Swiss soccer league title in 7 years after rallying from firing coach Wicky
- NBA playoffs: Edwards leads Wolves to 98
Popular articles
Recommended
Not so Cool Britannia! Noel Gallagher gives damning verdict on Keir Starmer
'The Apprentice,' about a young Donald Trump, premieres in Cannes
'Constantly learning' Imanaga off to impressive start with the Chicago Cubs
Cruise worker 'murders newborn son on board ship': Shocked co
US overdose deaths dropped in 2023, the first time since 2018
Young Boys seals 6th Swiss soccer league title in 7 years after rallying from firing coach Wicky
Sweden beats France, Britain relegated after losing to Norway at hockey worlds
Kate Hudson hits the stage to debut songs from her new album Glorious at star
Links
- Expanding common ground underpins regional stability
- Foreign Ministry gets new spokesman
- China slams India's tunnel inauguration in border area
- Mainland spokesperson affirms patrols from coast guard near Kinmen legitimate
- Mainland spokesperson affirms patrols from coast guard near Kinmen legitimate
- Xi holds talks with Angolan president
- Beijing urges respect in South China Sea dispute
- Central government authorities support and welcome passage of Article 23 legislation in Hong Kong
- Cabinet vows to deliver on policy pledges
- China releases full text of government work report