Greece falls deeper into recession as Portuguese banks ask for record ECB funds

Tim Wallace
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GREECE’S economic nightmare continued apace last month as industrial output plummeted again, according to figures released yesterday, while Portugal’s banks were forced to tap the European Central Bank (ECB) for a record amount of funding.

Unemployment figures due out on Thursday are expected to show another rise in Greek joblessness in January – 21 per cent were unemployed in December, and the situation is expected to worsen.

Weak domestic and export demand, against a backdrop of tough austerity measures, pushed industrial output down by another 8.3 per cent in the year to February.

The sovereign debt crisis also continued to pound Portugal, where banks borrowed a record €56.3bn (£46.4bn) from the ECB last month, up from €47.5bn in February.

Although the country’s borrowing costs fell over March from a peak of 14.1 per cent on 10-year debt to 11.1 per cent, they have since risen to 12.2 per cent as worries persist over the peripheral nations’ ability to pay their debts.

Meanwhile, Greek dockworkers begin a two-day strike against austerity today, which will hit ferry services which are vital to tourism.