German deceleration prompts double dip fears for eurozone

The economic recovery of the 16-nation eurozone stuttered in the third quarter of the year, official data published yesterday revealed, with even the strongest countries in the region warning of lower than expected growth. Overall, the eurozone economy grew by 0.4 per cent between July and September, compared to the 1 per cent of growth achieved between April and June.

Even Germany, which has so far been the powerhouse of the recovery, saw growth rates slip markedly. Its GDP grew by 0.7 per cent, well down on the record rate of 2.3 per cent recorded during the second quarter of the year.

France's third-quarter growth was 0.4 per cent, down from 0.7 per cent in the last quarter, while Italy posted 0.2 per cent, down from 0.5 per cent.

In Greece, which continues to be the worst performing member of the eurozone, recession continues. Its economy shrank by 1.1 per cent over the third quarter, though this was a marginally better performance than the second quarter's 1.7 per cent fall.

Jens Sondergard, an analyst at Nomura, described the figures as "slightly disappointing", though he said some sort of slowdown from the buoyancy of the second quarter had been expected. "The data confirmed expectations that the high second quarter GDP growth rates could not be sustained," Mr Sondergard said. "However, the euro-area economy continued to recover in the third quarter."

Nevertheless, the slowdown will be seen as a setback for the UK, for whom the eurozone is the most important trading partner. Mervyn King, the Governor of the Bank of England, warned earlier this week that the pace of recovery in the rest of the world would be the most important factor in whether the UK's own bounceback can be sustained – and how strongly.

As in the UK, there are fears the eurozone recovery could even go into reverse next year. Jennifer McKeown, the senior European economist at Capital Economics, said a particularly poor third quarter performance from the Netherlands, which like Germany is dependent on exports, did not bode well for the prospects of the eurozone's largest economy.

"This is probably a sign of things to come for Germany, where the industrial surveys point to a sharp slowdown," Ms McKeown said. "With the periphery looking worse and worse, we still see the eurozone's recovery grinding to a halt next year."

That would be a serious threat to countries struggling with debt problems, such as Ireland. If they end up exporting less to their neighbours than expected, growth will undershoot expectations, undermining the fiscal assumptions on which debtrepayment plans have been based.

Suggested Topics
Sport
Radamel Falcao
footballManchester United agree loan deal for Monaco striker Falcao
Voices
A man shoots at targets depicting a portrait of Russian President Vladimir Putin, in a shooting range in the center of the western Ukrainian city of Lviv
voicesIt's cowardice to pretend this is anything other than an invasion
Arts and Entertainment
The eyes have it: Kate Bush
music
Sport
Louis van Gaal, Radamel Falcao, Arturo Vidal, Mats Hummels and Javier Hernandez
footballFalcao, Hernandez, Welbeck and every deal live as it happens
PROMOTED VIDEO
Arts and Entertainment
booksNovelist takes aim at Orwell's rules for writing plain English
Arts and Entertainment
Al Pacino in ‘The Humbling’, as an ageing actor
filmHam among the brilliance as actor premieres two films at festival
News
Fifi Trixibelle Geldof with her mother, Paula Yates, in 1985
people
Sport
Mario Balotelli in action during his Liverpool debut
football ...but he can't get on the scoresheet in impressive debut
Arts and Entertainment
Downton Abbey fans rejoice, series five returns later this month
TV
Arts and Entertainment
booksExclusive extract from Howard Jacobson’s acclaimed new novel
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Application Support Analyst / Junior SQL Server DBA

£40000 - £45000 per annum: Ashdown Group: An established professional services...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Business Development Manager / Media Sales Exec

£28 - 32k + Uncapped Commission: Guru Careers: A Business Development Manager ...

C# .NET Developer (PHP, Ruby, Open Source, Blogs)

£40000 - £70000 per annum + Bonus+Benefits+Package: Harrington Starr: C# .NET ...

Day In a Page

Alexander Fury: The designer names to look for at fashion week this season

The big names to look for this fashion week

This week, designers begin to show their spring 2015 collections in New York
Will Self: 'I like Orwell's writing as much as the next talented mediocrity'

'I like Orwell's writing as much as the next talented mediocrity'

Will Self takes aim at Orwell's rules for writing plain English
Meet Afghanistan's middle-class paint-ballers

Meet Afghanistan's middle-class paint-ballers

Toy guns proving a popular diversion in a country flooded with the real thing
Al Pacino wows Venice

Al Pacino wows Venice

Ham among the brilliance as actor premieres two films at festival
Neil Lawson Baker interview: ‘I’ve gained so much from art. It’s only right to give something back’.

Neil Lawson Baker interview

‘I’ve gained so much from art. It’s only right to give something back’.
The other Mugabe who is lining up for the Zimbabwean presidency

The other Mugabe who is lining up for the Zimbabwean presidency

Wife of President Robert Mugabe appears to have her sights set on succeeding her husband
The model of a gadget launch: Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed

The model for a gadget launch

Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed
Alice Roberts: She's done pretty well, for a boffin without a beard

She's done pretty well, for a boffin without a beard

Alice Roberts talks about her new book on evolution - and why her early TV work drew flak from (mostly male) colleagues
Get well soon, Joan Rivers - an inspiration, whether she likes it or not

Get well soon, Joan Rivers

She is awful. But she's also wonderful, not in spite of but because of the fact she's forever saying appalling things, argues Ellen E Jones
Doctor Who Into the Dalek review: A classic sci-fi adventure with all the spectacle of a blockbuster

A fresh take on an old foe

Doctor Who Into the Dalek more than compensated for last week's nonsensical offering
Fashion walks away from the celebrity runway show

Fashion walks away from the celebrity runway show

As the collections start, fashion editor Alexander Fury finds video and the internet are proving more attractive
Meet the stars of TV's Wolf Hall... and it's not the cast of the Tudor trilogy

Meet the stars of TV's Wolf Hall...

... and it's not the cast of the Tudor trilogy
Weekend at the Asylum: Europe's biggest steampunk convention heads to Lincoln

Europe's biggest steampunk convention

Jake Wallis Simons discovers how Victorian ray guns and the martial art of biscuit dunking are precisely what the 21st century needs
Don't swallow the tripe – a user's guide to weasel words

Don't swallow the tripe – a user's guide to weasel words

Lying is dangerous and unnecessary. A new book explains the strategies needed to avoid it. John Rentoul on the art of 'uncommunication'
Daddy, who was Richard Attenborough? Was the beloved thespian the last of the cross-generation stars?

Daddy, who was Richard Attenborough?

The atomisation of culture means that few of those we regard as stars are universally loved any more, says DJ Taylor