Euro zone headed back towards recession
BRUSSELS (AFP) - The euro zone veered back towards recession with the latest growth figures out on Tuesday showing its economy shrinking by 0.2 per cent and analysts warning of falling economic output right through 2013.
Germany steered clear of the worst of the debt crisis to post better-than-expected growth of 0.3 per cent in the period from April to June, and France held on for zero growth, but the experts saw precious little good news going forward.
"The big picture is that the economic growth required to bring the region's debt crisis to an end is still nowhere in sight," said London-based Mr Jonathan Loynes of Capital Economics.
"The slowdown has spread from the periphery into the core," said Mr Tom Rogers, an analyst with Ernst & Young in London, one of many analysts to highlight a growing "north-south divide." "Positive readings in Germany and the Netherlands (0.2 per cent) are to be welcomed, but with conditions in the rest of Europe deteriorating further, and export markets farther afield also cooling, it is looking increasingly likely that output in the core economies will contract during the second half of the year," Mr Rogers added.