The outlook for a quick rebound in the European economy is weak.
The outlook for a quick rebound in the European economy is weak.
Gross domestic product in the Eurozone fell 1.5% in the fourth quarter and 1.2% from the comparable 2007 quarter, a plunge that economist Howard Archer of IHS Global Insight called "horrific" after the data were released Friday.
"It was the deepest quarter-on-quarter contraction in GDP since the Eurozone came into being in 1999," the London-based economist wrote in a note to investors, adding that it and other survey data "point to ongoing substantial contraction" in European economies this year. The good news: The contraction probably won't be as severe as it was last quarter.
The data verified that the Netherlands has formally joined Germany, Italy, Spain and Portugal in recession, "while France is there in all but name," the economist wrote. The steepest decline last quarter was Germany's 2.1% GDP loss, the sharpest one-quarter drop since East and West Germany reunited in 1990.
"We expect Eurozone GDP to contract by 2.3% in 2009 as it is hit hard by global economic recession, extended tight credit conditions and financial sector problems, rising unemployment and very weak business and consumer confidence," Mr. Archer forecast. "Given these factors, it will take time for muted oil and commodity prices, very low interest rates and widespread fiscal stimulus to generate recovery."
Charles Schwab & Co. Inc., the San Francisco-based discount broker and asset custodian, said Friday that its clients in January added $586.3 million to international stock funds, second only to the $2.3 billion they poured into taxable bond funds last month.
