The Ukraine-Russia fallout— Eurozone in recession
All the 20 Eurozone counties slipped into recession in the first three months of 2023.
The Ukraine-Russia fallout— Eurozone in recession
All the 20 Eurozone counties slipped into recession in the first three months of 2023. The Eurozone's GDP contracted by 0.1% in the first quarter, followed by a decline of the same magnitude in the last three months of 2022. This fits the definition of a recession- two consecutive quarters of contraction in economic output. The Eurozone last slid into recession in 2020.
The mild recession that the zone faces is a result of a spike in the prices of food and energy following Russia's invasion of Ukraine. As inflation soared to record highs, household spending was hit hard.
Plus, the government's final consumption spending toocrashed in the first three quarters. Investment (or, gross final capital formation) increased, but it alone could not offset the declines in spending.
• recession- A recession typically involves the overall output in an economy contracting for at least two consecutive quarters, along with job losses and reduction in overall demand.
• GFCE- is the expenditure by general government bodies on services to the community such as defence, education, public order and safety
• GFCF- consists of resident producers' investments in fixed assets during a given period.