This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Eurozone Recovery Hits Snag In Third Quarter

By PAN PYLAS

LONDON (AP) a¿¿ Three months after it emerged from recession, the 17-country eurozone economy is scarcely growing.

The currency union's economy expanded just 0.1 percent in the July-September quarter compared with the previous three-month period, the EU statistics agency, Eurostat, said Thursday. That was in line with market expectations but below the previous quarter's 0.3 percent increase.

The figure highlights the bloc's struggles to regain economic health despite signs of life in the rest of the global economy, notably in the United States. European government debt, despite years of government cutbacks and tax increases, remains high, unemployment is at a record, and consumers are hesitant to spend.

As a result, few economists think the recovery in the eurozone can pick up a head of steam and become self-sustaining in the way it has in the U.S. In the third quarter, the U.S. grew at an annualized rate of 2.8 percent, compared with the eurozone's annualized rate of about 0.4 percent.

"The drop in the eurozone growth rate does not mean that the eurozone is heading back into recession but it highlights that the recovery is fragile and, as yet, too slow to lead to a significant fall in unemployment," said Marie Diron, senior economic adviser to EY, formerly known as Ernst & Young.

The weak economic backdrop is one reason why the European Central Bank cut its main interest rate last week to a record-low 0.25 percent. The other being low inflation. In the year to October, consumer prices were up only 0.7 percent, way down on the ECB's mandate of keeping inflation just below 2 percent.

Though details were not provided for individual sectors, Thursday's figures show the recovery slowed in the core economies, such as Germany and France, with mild improvements in countries in the so-called periphery, notably in Spain, which saw its nearly two-year recession end.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs