Eurozone recession deeper than expected but Irish growth this year – EU
THE eurozone faces a deeper recession than earlier believed but the Irish economy is estimated to have returned to modest growth of 0.9pc in 2011, after a sharp contraction of 10pc in output between 2008 and 2010.
According to the European Commission, Irish growth was entirely export-led and the economy will grow by just 0.5pc this year.
It is predicting a 0.3pc contraction in eurozone Gross Domestic Product for 2012, compared with 0.5pc growth in its last November forecast.
"The unexpected stalling of the recovery in late 2011 is set to extend into the first two quarters of 2012," the European Commission said today but stressed it saw a "mild recession with signs of stabilisation."
European Union Economy Commissioner Olli Rehn said this compared to global growth of 4.3pc this year.
In an usual move, EU executives fed in data from all 27 EU states - not just the seven biggest - in a bid to make its forecasts more robust.
The European Commission said "modest growth is predicted to return in the second half of the year," with inflation revised "slightly upwards" to 2.1pc across the 17-state euro currency area, mainly due to energy costs and "increases in indirect taxes."