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As if the news of economic contraction in Japan, Germany and France in the fourth quarter of last year was not bad enough, new data from Eurostat shows the euro area and EU27 have fallen into a persistent and deep economic contraction. GDP data from Italy (-0.9% GDP Q4) and Spain (-0.7% GDP Q4) were particularly troubling.

The Eurostat report shows:

GDP fell by 0.6% in the euro area1 (EA17) and by 0.5% in the EU271 during the fourth quarter of 2012, compared with the previous quarter, according to flash estimates published by Eurostat, the statistical office of the European Union.

In the third quarter of 2012, growth rates were -0.1% and +0.1% respectively. Compared with the same quarter of the previous year, seasonally adjusted GDP fell by 0.9% in the euro area and by 0.6% in the EU27 in the fourth quarter of 2012, after -0.6% and -0.4% respectively in the previous quarter.

During the fourth quarter of 2012, GDP in the United States was stable compared with the previous quarter (after +0.8% in the third quarter of 2012). Compared with the same quarter of the previous year, GDP rose by 1.5% in the United States (after +2.6% in the previous quarter).