September sees a recession in the euro zone with stagnant GDP and employment
The euro zone economy stalled In the third quarter of the year in relation to the previous quarter, co An advance of 0.2% compared to an increase of 0.7% between April and June. Data published this Tuesday by Eurostat, the Community Statistics Office, confirms the slowdown in employment mobility and puts the region close to a technological recession at the end of this year and early next, according to the European Commission. Then, according to forecasts shared by other institutions such as the International Monetary Fund (IMF) or the European Central Bank (ECB), the GDP of all countries sharing the euro will probably fall for two consecutive quarters.
Data from the European Union for Twenty-Seven paints a similar picture, although the slowdown is even sharper, as the group of countries’ GDP grew by 0.2% quarter-on-quarter, compared with 0.8% in the previous quarter, amid a crisis caused by the war in Ukraine and rising energy prices. Both currencies have fueled record high inflation in the euro zone (It marked 10.7% in the euro zone in October, the highest since the entry into the common currency) and has put additional pressure on the European Central Bank, which has been forced to maintain its policy of raising rates amid increasingly weak macros. environment and in which the labor market also suffers.
Employment grew by only 0.2% in both regions in the third quarter, compared to 0.4% in the previous period. In year-on-year terms (if the data is compared only to the same quarter a year earlier), GDP grew by 2.1% in the euro zone and by 2.4% across the EU between July and September, down from 4.3% in the second quarter. The number of people employed in countries sharing the currency rose 1.7% year-on-year and 1.5% in twenty-seven, growth that also weakened relative to the 2.7 and 2.4% growth recorded by the two regions. , respectively, in the entire previous quarter.
Germany and Italy have survived despite their worst odds
Among the major economies, Italy and Germany are currently showing the greatest dynamism. Due to their low dependence on Russia and their low energy diversification – both are facing a longer-than-expected recession – according to estimates by key international bodies. The Transalpine economy grew by 0.5% in the third quarter and the German economy by 0.3%In both cases above the 0.2% published for Spain in the same period by the National Institute of Statistics.
However, neither Rome nor Berlin managed to stop the rise in prices for the moment. Its annual inflation rate rose to between 11.9 and 10.4% last month, in stark contrast to the path Spain is following, where the CPI has chained three months of control from a peak of 10.8% marked in July (this Tuesday’s figures confirmed inflation. Cheap Gas and electricity rose to 7.3% in October).
Apart from the largest economies, Cyprus and Romania (both 1.3% advance between July and September) and Poland (0.9%) and Sweden (0.7%) reported the largest quarterly advances in their economies. On the opposite side are Latvia (-1.7%), Slovenia (-1.4%), the Czech Republic and Hungary (both with declines of 0.4%), as well as Belgium, Austria and Finland (-0, 1%) whose economies are shrinking due to greater dependence on Moscow. are
Among the explanatory factors The most obvious weakness of the European economy is compared to other regions of the planet, not only the huge impact of energy growth (on which Europeans are more dependent), but the weakness of the foreign sector, the tightening of financing conditions and the lack of clear medium-term prospects due to the war in Ukraine. The positive part is that the labor market is resisting and, in fact, the European Commission was confident in its latest forecasts that employment – already at an all-time high – will grow by 1.8% in the EU and the euro this year. zone
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