Posted on 05/15/2009 8:33:01 AM PDT by TigerLikesRooster
Euro zone contracted by massive 2.5 pct in Q1
Euro zone economy contracted by massive 2.5 percent in Q1, fourth straight decline
Pan Pylas, AP Business Writer
On Friday May 15, 2009, 7:24 am EDT
Buzz up! Print LONDON (AP) -- The economy in the 16 countries that use the euro shrank by a massive 2.5 percent in the first quarter as a global recession sapped the industrial exports that Europe relies on for growth and jobs.
Germany, the euro zone's biggest economy, saw output plunge by 3.8 percent as demand for its cars and factory machinery collapsed -- its biggest economic contraction since at least 1970, when West Germany started to compile records.
The euro zone has now seen output decline for four consecutive quarters. The first quarter slump is the biggest since figures began in 1995, but most analysts think the region is in its worst slump since the end of World War II.
(Excerpt) Read more at finance.yahoo.com ...
Ping!
2.5 or annual rate of 2.5?
I interpret the article as “2.5% for the quarter”, 10.0% annually (ignoring compounding).
That is reasonable, however economic growth quarterly reports often speak to an annual rate. The writer of this piece is not a regular economics report.
Another article stated that it was a 4.6% drop from one year ago, so I suspect that it is 2.5% just for the first quarter or else they would be talking of the recession bottoming out. Yike!
I’m pretty sure they do it q-on-q, so it would be 10% annual, which makes sense it you consider Germany is contracting over 8% and much of E. Europe by 10-15%.
The subheading uses the term “massive”. A 2.5% annual dip in GDP is not “massive. 10% is, so he must be talking 2.5% for the quarter. Yes, that is massive and equates to “depression” level GDP contraction.
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