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Wednesday 23rd of December 2009
May 15, 2009    

Euro zone economy shrinks 2.5%, Hong Kong suffers 7.8% fall

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by Kay Murchie

As the recession continues to grip many economies, Gross Domestic Product (GDP) figures are being released this week with the euro zone the latest to provide figures.

According to the EU’s statistics agency Eurostat, the euro zone economies contracted by 2.5% in the first quarter of 2009 - higher than the 2% fall predicted by analysts.

GDP in the 16 countries that make up the euro zone fell 4.6% on an annualised basis.

A main factor in the fall was a severe fall in German exports - the country is the world’s largest exporter and many reports have suggested that the country’s exports are in ‘freefall’.

It was reported earlier today that Germany’s economy fell 3.8% in the first three months of 2009, compared with the previous quarter when GDP fell 2.2%. On an annual basis, the economy shrank by 6.7%.

Also today, France’s statistics office, Insee, reported that the French economy contracted 1.2% in the first three months - as expected.

France’s statistics office, Insee, said the fall was less than the 1.5% fall reported in the fourth quarter of 2008.

Yesterday, it was reported that Spain’s economy had suffered its steepest fall since 1959.
According to the National Statistics Institute, which is set to release final statistics next week, Spain’s GDP fell 1.8% compared with the previous quarter and is down 2.9% on an annualised basis.

Meanwhile, Eurostat reported consumer price inflation in the euro zone remained steady at 0.6% in April.

Meanwhile, further a field, it was revealed that Hong Kong’s economy contracted by 7.8% in the first three months of this year, compared with a year earlier.

The economy has been hit by falling exports and the contraction represents the economy’s worst performance since the Asian financial crisis over a decade ago.

Hong Kong’s exports plummeted by 22% during the three month period.

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