Europe on the edge of recession
LONDON — Europe is edging closer to recession, dragged down by the crippling debt problems of the 17-country euro bloc, official figures showed today.
Eurostat, the European Union’s statistics agency, revealed the economies of both the eurozone and the wider 27-country EU shrank by a quarterly rate of 0.2 percent in the second quarter of the year. In the first quarter, output for both regions was flat. A recession is officially defined as two straight quarters of falling output.
Europe’s debt woes have been blamed for the sharp deterioration in the global economic outlook over the last few months. The region is the U.S.’s largest export customer and any fall-off in demand will hit order books — as well as President Barack Obama’s election prospects.
The eurozone is grappling with sky-high debt levels and record unemployment of 11.2 percent. Compared with the year before, the eurozone’s economy is 0.4 percent smaller.
