Eurozone Records Longest Ever Recorded Recession

The Eurozone’s economy has hit a record high after new figures showed it contracted for the sixth straight quarter.

Falling output from France to Finland meant that the 17-nation economy shrunk 0.2 percent in the January to March period, its longest recession since records began in 1995, the EU’s statistics office Eurostat said on Wednesday.

INSEE (National Institute of Statistics and Economic Studies) statistics agency also issued figures on Wednesday which showed that Germany, which generates almost a third of the eurozone’s economic output, unexpectedly recorded only 0.1 percent growth, barely skirting the recession that France succumbed to.

French president Francois Hollande confirmed that the eurozone’s second biggest economy had entered its first recession in four years in the first quarter of the year as the economy contracted by 0.2 percent.

“It is likely that there will be zero growth in 2013,” Hollande said at a news conference in Brussels on Wednesday.

The French leader said France had come through the worst and that the confirmation of recession for his country was the announcement of something that had already happened, not something about to take place.

The gross domestic product (GDP) contracted because of weak exports, investment and household spending, after shrinking the same amount in the last quarter of 2012.

Two consecutive quarters of contracting GDP are indicative of an economy in recession.

Hollande said that the recession across the eurozone, home to some 340 million citizens and the biggest tariff-free market outside the United States, could be explained by “the accumulation of austerity politics”.

He also blamed a “lack of liquidity” within the banking sector in some countries and a consequent loss of confidence at large.

The bloc’s recession is now longer than the five quarters of contraction that followed the global financial crisis in 2008 and 2009, and dampens optimism of a quick recovery.

Unemployment has now been driven to a record 19 million people.

The economy also shrank for the quarter in Finland, Cyprus, Italy, the Netherlands, Portugal and Greece.

Data issued last month showed Spain’s economy contracted for a seventh consecutive quarter, while Italy, the eurozone’s third largest economy, reported its seventh consecutive quarter of decline, the longest since records began in 1970.