Wednesday, February 21, 2018
News Roundup

Europe on the edge of recession

LONDON — Europe is edging closer to recession, dragged down by the crippling debt problems of the 17 countries that use the euro, official figures showed Tuesday.

Eurostat, Europe's statistics agency, revealed that the economies of both the euro zone and the European Union, which has 27 countries, 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 United States' largest export customer and any fall-off in demand will hit order books — as well as President Barack Obama's election prospects.

The 17-country euro zone is grappling with sky-high debt levels and record unemployment of 11.2 percent. Compared with the second quarter of last year, the euro one's economy is 0.4 percent smaller.

The region's economy would have slipped into recession had it not been for better-than-expected GDP figures from its two leading economies, Germany and France.

Germany, Europe's biggest economy, posted quarterly growth of 0.3 percent, better than the 0.2 percent uptick forecast. France also beat expectations of a small contraction in its output to record no change in its economy for the second quarter.

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