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| Version 0 | Version 1 |
|---|---|
| Coronavirus: Eurozone economy shrinks at record rate | Coronavirus: Eurozone economy shrinks at record rate |
| (about 1 hour later) | |
| The eurozone economy shrank at the sharpest pace on record in the first quarter as the Covid-19 pandemic forced countries into lockdown. | The eurozone economy shrank at the sharpest pace on record in the first quarter as the Covid-19 pandemic forced countries into lockdown. |
| A first estimate of GDP between January and March showed a contraction of 3.8%, worse than during the financial crisis. | A first estimate of GDP between January and March showed a contraction of 3.8%, worse than during the financial crisis. |
| Separate figures revealed a steep fall in economic activity in France and Spain over the same period. | Separate figures revealed a steep fall in economic activity in France and Spain over the same period. |
| In Germany, unemployment has increased though it remains relatively low compared with other nations. | In Germany, unemployment has increased though it remains relatively low compared with other nations. |
| On Wednesday, the US revealed that its economy had suffered its most severe contraction for more than a decade, after GDP shrank at an annual rate of 4.8% in the first quarter of the year. | |
| However, this "annualised" rate implies that the US economy actually contracted by about 1.2% in the three-month period, a less severe contraction than in the eurozone. | |
| 'Free-fall' | |
| Andrew Kenningham of Capital Economics called the European news a blizzard of depressing economic data that "confirms that the eurozone economy was in free-fall". | |
| In the case of France, the 5.8% decline in gross domestic product (GDP) was the largest the quarterly series has recorded since it began in 1949. | |
| Two other large economies have published first estimates: Spain saw a contraction of 5.1% while Italy's economy shrank by 4.7%. | |
| The figure for the eurozone as a whole was more moderate, but is still by any standards severe especially for a contraction over just three months. | |
| So far most individual European countries have not published national estimates. That applies to the largest of them, Germany. | |
| But new figures for the German labour market are beginning to show the impact of the pandemic, with the number of people out of work rising by 373,000 in April. | |
| However, the full impact is damped by the country's system of financial help to people put onto shorter working hours, known as Kurzarbeit. | |
| Claus Vistesen of Pantheon Macroeconomics said the news on the Geman labour market was "bad, but it would have been disastrous without Kurzarbeit". |