Eurozone contracts 0.2% quarter-on-quarter in January-March amid Iran headwinds
Updated Eurostat data show the eurozone economy contracted 0.2% quarter-on-quarter in the first three months of the year. The reading came in weaker than the earlier preliminary estimate. A softening in industrial output and Iran-linked energy uncertainty are flagged as the main factors.
Photo: Fabio Riccobono / PexelsRevised Eurostat data show that the eurozone economy contracted 0.2% in the first three months of the year compared with the previous quarter. The figure presents a weaker picture than the earlier 0.1% estimate. On an annual basis growth was limited.
The data show that the decline in German industrial output had a marked effect on the bloc's overall performance. In Italy, the slowdown in domestic consumption stood out. Economists argue that energy-price uncertainty created by the Middle East conflict has been delaying investment decisions.
These readings are expected to weigh in the European Central Bank's policy rate discussion at its June meeting. Investing.com reports that the market is starting to price a more cautious growth outlook in the near term. PMI and retail sales data due in the coming weeks will give further clues on the trend's direction.
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