Industry declines in the Eurozone while Portugal falls even deeper into recession

Julian Harris
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THE SHADOW of the Eurozone crisis darkened yesterday as more bearish economic data emphasised the single currency area’s woes.

Yet another spell of economic contraction was confirmed in Portugal for the third quarter of the year, confirming the bailout-recipient’s lingering double-dip recession.

And across the 17-nation Eurozone, industrial production was revealed to have fallen by two per cent in September, compared to August.

“The decline was pretty broad-based by country,” said Ben May of Capital Economics. “The troubled Italian economy recorded a particularly steep monthly decline of 4.8 per cent, supporting our view that Italy needs more than a change of government to solve its problems.”

The figures are prone to monthly fluctuations, however. In August, industrial production rose by 1.4 per cent in the Eurozone and by one per cent in the European Union area.

Yet downbeat business surveys point to a potentially sharp contraction in industrial production in the Eurozone in the final three months of the year, May added.

Meanwhile the Portuguese economy shrank by 0.4 per cent in the three months to September, according to an official estimate. Compared to a year earlier, GDP was down 1.7 per cent.