Eurostat reports the biggest fall in the EU economy over the past 25 years
According to preliminary estimates, the GDP of the EU zone decreased by 3.8% in the first quarter compared to the same period last year, Forbes reported, citing data from Eurostat. Taking into account all the member states of the European Union, the decline was 3.5%. As a result, the collapse of the economy of the EU zone reached 3.3%.
The fall was the largest in the last 25 years, when Eurostat began to publish quarterly statistics. On a year-on-year basis, the decline was the most severe since 2009, when EU states recovered from the 2008 economic crisis. The EU area includes 19 states, while the European Union includes 27 countries, 8 of which have not abandoned their own national currencies.
The statistical office noted that in March this year, governments began to introduce a self-isolation regime to limit the spread of the coronavirus. The growth of the unemployed population in this month rose to 7.4% in the Eurozone and 6.6% in the European Union. Analysts expect inflation to fall in April from 0.7% to 0.4%.
The Central Bank of Europe didn’t change the refinancing rate. It has remained at 0% since March 2016. The rate on deposits was –0.5%, and on lending to banks — 0.25%.
According to the results of the quarter since the beginning of the research (1949), the largest drop was in the French GDP. The economy lost 5.8%. The collapse of the rate is largely associated with the introduction of a self-isolation regime, as well as with the suspension of “insignificant” activities.
In Spain, the decline seemed to be the most severe since 1970 and reached 5.2% compared to the same period in 2019. At the moment, the state has suffered the most from the pandemic in terms of the number of infected.
The largest number of coronavirus victims in Europe is in Italy. This country was the first country in the EU which introduced restrictive measures. Its GDP is down by 4.7% from the last quarter of last year.
On April 29, the United States Bureau of Economic Research released a report that said the country’s GDP fell by 4.4% compared with last year. This is the first such contraction in the world’s largest economy, and the most severe decline in the US economy since the 2008 crisis. Despite the results of reporting, the US Federal Reserve left the refinancing rate unchanged.