Eurozone Slipped Into Recession Early in the Year
The New York Times The News
The eurozone slipped into a recession earlier this year amid the shock of high food and energy prices, Europes statistics agency reported Thursday. The shallow downturn reflected the challenges facing the European Central Bank as policymakers weigh how to continue curbing high prices without further damaging the economy.
Growth in the 20 nations that use the euro currency declined in the first three months of the year by 0.1 percent, revised data showed, following a fourth-quarter contraction of the same magnitude. It was the first six-month contraction in the eurozone since early in the coronavirus pandemic, creating what economists call a technical recession.
Why It Matters
Stubbornly high inflation tipped many consumers across the continent into a cost-of-living crisis, prompting them to pull back considerably on spending during the period. Spending in the eurozone fell 0.3 percent in the first three months of this year after falling 1 percent in the previous quarter. Imports were also down sharply as demand for goods and services shrank.
