Eurozone Economy Shrinks at Slower Pace in Q2

The eurozone economy shrank at a slower pace in the second quarter of 2009, suggesting the worst part of the economic crisis may be over, figures from the EU's statistic bureau Eurostat showed.

In the second quarter, the combined economy of the 16-nation bloc that share the euro fell by 0.1 percent, compared with the previous quarter, Eurostat said, confirming a previous estimate released last month.

Although the eurozone economy continued to decline in the second quarter after being hard hit by the financial crisis, the situation is improving from the first three months of this year, when it contracted sharply by 2.5 percent quarter on quarter.

Compared with the second quarter of 2008, the eurozone economy declined by 4.7 percent, following a year-on-year drop of 4.9 percent in the previous quarter.

Eurostat said the improvement was mainly supported by stronger household consumption expenditure, which increased by 0.2 percent in the second quarter after a fall of 0.5 percent in the previous three months.

Investment and exports decreased by 1.3 percent and 1.1 percent, respectively; however, the pace was much slower than that in the first quarter.

Among major eurozone member states, Germany and France were lucky to get out of a technical recession in the second quarter. Both economies rose by 0.3 percent from the first quarter.

For the whole European Union (EU), the economy of the 27-nationbloc contracted by 0.2 percent in the second quarter, compared with the previous quarter, and fell by 4.8 percent year on year.

In the first quarter, the EU economy declined by 2.4 percent from the previous three months and by 4.8 percent from a year ago.