|Eurozone first-quarter growth below expectation
The eurozone economy grew much slower than expected in the first quarter of 2014, official data showed Thursday, while fourth-quarter performance was revised down, stoking concerns the recovery is struggling.
Eurostat said the 18-nation eurozone grew 0.2 percent in the three months to March, short of analyst forecasts for 0.4 percent, while the fourth quarter of 2013 was cut to 0.2 percent from the initial estimate of 0.3 percent, AFP reports.
Figures earlier Thursday showed the German economy, Europe's biggest, beat estimates with a first quarter gain of 0.8 percent, but faltering France fell back further, with no growth at all.
Analysts said the currency bloc's first-quarter outcome was disappointing and increases the likelihood the European Central Bank will have to take more measures to stimulate growth when it next meets in June.
"In all, the figures point to a very slow recovery... which will do little to erode spare capacity or reduce deflation risks,'' Jennifer McKeown at Capital Economics said.
"This should encourage the ECB to cut interest rates next month and prepare a quantitative easing (stimulus) programme for use in the near future.''
The eurozone finally escaped a record recession in the second quarter of 2013 with growth of 0.3 percent, but this slowed to 0.1 percent expansion in the third quarter.
The subsequent quarterly figures suggest the eurozone is simply not growing fast enough to cut near record unemployment levels and take up the slack in the economy.
McKeown said Thursday's figures suggest the eurozone economy could post overall growth of 1.0 percent this year, compared with the EU's recent forecast for 1.2 percent.