Gross domestic product in Europe declined .1% in the third quarter, sending the Eurozone area into recession for the second time in four years.
The decline came after a .2% contraction in the previous quarter. Unexpected strength in the economies of Germany and France were vastly outweighed by other countries.
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Germany’s economy grew .2% in the third quarter on top of a .3% rise in the previous three months.
Greece’s economy contracted for its 17th consecutive quarter and Portugal has now been in recession for two years.
The contractions come as governments across the area impose strict austerity measures that are spurring protests as wages are reduced, jobs are cut, and public services are restricted.
Europe’s slip in to recessionary territory is against the backdrop of a strengthening US economy and a bottoming out of China’s economy.
Both the US and China have implemented aggressive stimulus action to jumpstart their economies. So far, Europe has depended on strict spending cuts with only the promise of stimulus if countries ask for it.
Olli Rhen, the European Union’s Economic and Monetary Affairs Commissioner stated that indicators in the region signal that more weakness is on the horizon.
Despite Germany’s economic growth, confidence of investors slipped unexpectedly in November.
The reigniting of US and Chinese exports
on top of strength in the US housing sector may enable the global economy to shake off Europe’s woes and possibly lend support to Europe’s efforts to simply stop the decline over the next six months.