Eurozone hit by construction sector collapse

Tim Wallace
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RECESSION fears were raised further yesterday as figures showed a huge monthly fall in Eurozone construction output in February – the third monthly fall in the sector.

However, official trade data confirmed the EU as a whole recorded its first current account surplus in almost a decade in the final quarter of last year, adding to GDP growth.

Construction output fell 7.1 per cent in the currency area on the month, and 12.9 per cent compared with February 2011.

For the full EU, the monthly drop was 3.7 per cent and the annual fall stood at 9.4 per cent.

The decline represents the third monthly decline in Eurozone construction production, following falls of 0.5 per cent in January and 2.1 per cent in December. Output also fell in September and October.

The collapse in EU output was broadly based in February – 12 countries saw output fall, two experienced a rise and Sweden saw no change.

Germany’s crash was the worst, with output plummeting 17.1 per cent, followed by 10.3 per cent in Slovenia and 9.9 per cent in Italy.

The UK registered the largest expansion at 5.7 per cent, followed by Romania at 1.7 per cent.

Meanwhile revised current account figures for the final quarter of 2011 showed a €13.1bn surplus – the first for the EU since mid-2002.

A falling goods deficit and rising services surplus led to the shift from the previous quarter’s €16bn deficit, the figures showed.