It’s been on the cards for a while now but on Wednesday it was made official. France is now in recession, heightening fears that the Eurozone debt crisis has reached the heart of the single currency bloc.
According to official figures the French economy contracted by 0.2% in the first quarter of 2013 marking its entry into its second recession in four years. Although it was thought to have been in recession in 2012, these figures have now been revised to show only one quarter of negative growth allowing the nation to avoid the stigma of suffering from a triple-dip.
Dismal GDP data from across the Eurozone highlights just how deep the impact of the Euro crisis has been. The overall Eurozone economy contracted by 0.2% in the first three months of 2013, this follows a 0.6% drop in Eurozone GDP in the last quarter of 2012, and a 0.5% fall across the EU. So if you want a silver lining, the pace of decline is slowing.
But the data means that the Eurozone economy is 1% smaller than a year ago, while EU GDP is 0.7% smaller.
Italy is now in its longest recession since quarterly records began 43 years ago after its economy shrank yet again, this time the nations GDP fell by 0.5% in the first quarter of the year meaning that overall its economy has contracted 2.3% over the past twelve months. Spain sunk deeper into the mire also with a decline of 0.5%.
Once one of the Eurozone’s strongest members, the Netherlands is now feeling the brunt of the regions steady decline. It’s GDP contracted by 0.1%. Austria’s economy flat lined at 0.0%.
“This shows that fiscal tightening and the deterioration of market conditions in most of Europe are taking a bigger toll,” Ricardo Santos a Euro-zone economist at BNP Paribas said, “That’s particularly worrying as the recent leading indicators for all the countries, including the core, have disappointed recently.”
Even Germany disappointed as the regions strongest economy only just managed to eke out growth of 0.1%, a figure that was far weaker than the expected 0.3% expected by economists. Annual figures from the Statistics Office also show the German economy has shrunk by 1.4% when compared with a year ago.
Current Euro (EUR) Exchange Rates
The Euro/US Dollar Exchange Rate is currently in the region of: 1.2902
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8451
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.3050
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.5718
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7747
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1802
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7651
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6348
(Correct as of 10:40am GMT)