Europe’s economy contracted at the fastest pace in at least 13 years in the first quarter as companies cut output and jobs to survive the worst global slump in more than six decades.
Gross domestic product in the 16-member euro region dropped 2.5 percent from the fourth quarter, when it fell 1.6 percent, the European Union’s statistics office in Luxembourg said today. That’s the biggest drop since the euro-area GDP data were first compiled in 1995 and exceeded the 2 percent decline economists expected in a Bloomberg News survey. Inflation held at 0.6 percent in April, a separate report showed.
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In Germany, Europe’s largest economy, GDP dropped 3.8 percent in the first quarter from the previous three months. That’s the biggest drop since data were first compiled in 1970. Italian GDP fell 2.4 percent, the most since records began in 1980, and the French economy shrank 1.2 percent in that period. The economies of the Netherlands and Austria also contracted.
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In Japan, machinery orders fell 1.3 percent in March, a sign that managers remain wary of upgrading factories and equipment before a recovery takes hold. Japan next week may say its economy shrank a record 4.3 percent in the first quarter from the fourth, according to a survey of economists.
One of the bright spots for the US economy at the end of the latest expansion was export growth. But -- who are we going to export to?
