The eurozone (20 countries using the euro) managed to escape a “technical recession” in the fourth quarter of last year.
According to Eurostat, an EU statistical body, on the 30th (local time), the eurozone’s gross domestic product (GDP) growth rate in the fourth quarter of last year was 0.0% compared to the previous quarter.
It managed to avoid a technical recession by slightly defying the market’s forecast that it would grow 0.1% in the fourth quarter.
A technical recession generally means two consecutive quarters of negative growth. The eurozone’s GDP growth rate in the third quarter was -0.1%.
The main impact of the eurozone’s economic contraction was that Germany, the largest economy by country, recorded -0.3% of GDP growth in the fourth quarter of last year compared to the previous quarter.
France remained flat, recording a 0.0% GDP growth rate.
The prevailing observation is that the economic outlook is not bright this year.
Jack Allen Reynolds, a researcher at research firm Capital Economics, told AFP that “growth is expected to stagnate in the first half of this year as the impact of previous tightening currencies continues and fiscal policy becomes more limited.”
In particular, he added, the eurozone’s avoidance of a technological recession was “just semantic.”
Eurostat also said the eurozone’s annual GDP growth rate last year was 0.5% year-on-year.
This is slightly lower than the 0.6% forecast released by the European Commission in November last year.
At the time, the Commission predicted that eurozone GDP would grow 1.2% this year, but there is a possibility that it will be lowered in its new economic outlook next month.
