Wednesday, May 15, 2013

Guess What? The EU Is Still A Basket Case!

From the latest GDP report:

GDP fell by 0.2% in the euro area1 (EA17) and by 0.1% in the EU271 during the first quarter of 2013, compared with the previous quarter, according to flash estimates2 published by Eurostat, the statistical office of the European Union. In the fourth quarter of 2012, growth rates were -0.6% and -0.5% respectively.

Compared with the same quarter of the previous year, seasonally adjusted GDP fell by 1.0% in the euro area and by 0.7% in the EU27 in the first quarter of 2013, after -0.9% and -0.6% respectively in the previous quarter.

Let's look at the data from the report:
The chart above shows the EU has been contracting for over five quarters.  More importantly, let's look at the breadth of the contraction:

As the above chart shows, the breadth of the slowdown is wide: 8 countries have seen four straight quarters of year over year contraction.  France and Germany have printed a negative Y/O/Y number in the latest quarters.  Only three countries (the Baltic state of Latvia, Lithuania and Estonia) are showing any rate of meaningful Y/O/Y/ growth and they are still far below potential GDP rates with high unemployment. 

This is the net end result of austerity.