No Christmas boost for euro zone economy in fourth quarter

Wed Mar 6, 2013 5:00am EST

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* Economy shrinks 0.6 percent in Q4, quarter-on-quarter
    * Economy contracts 0.9 percent year-on-year, Eurostat says

    BRUSSELS, March 6 (Reuters) - Falling business investment
and consumers' reluctance to spend even at Christmas damaged the
euro zone's economy in the last three months of last year, which
policymakers hope signals the lowest point in the bloc's
recession.
    Economic output from the 17 nations sharing the euro fell
0.6 percent in the fourth quarter of 2012, EU statistics agency
Eurostat said on Wednesday, confirming its earlier reading, the
biggest quarter-on-quarter fall in a year of contraction.
    As expected, the euro zone ended the year in its second
recession since 2009, a reality already too well-known to
millions of Europeans suffering from record unemployment and a
debt crisis that nearly broke up the currency area last year.
    Eurostat fleshed out its numbers, showing Germany as the
only major euro zone economy to grow in the quarter, although
growth slowed to a crawl, while France, Spain and Italy all
contracted.
    Overall, government spending made no contribution to gross
domestic product in the final quarter of 2012, highlighting the
German-led austerity that is aimed at cutting budget deficits
but which many economists say is deepening the recession.
    A lack of spending by households shaved 0.2 percentage
points from the quarterly GDP figure, and business investment
also dragged down output by the same margin.
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