The euro area economy contracted year on year and quarter on quarter in the first quarter

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The economies of the euro-paying countries fell by 1.8 percent year on year between January and March. The performance of the European Union’s economy has fallen to almost the same extent. Portugal saw the biggest drop.

The euro area recorded a quarter-on-quarter decline in the gross domestic product of 0.6 percent in the first quarter, almost the same result as in the last quarter of last year. However, the year-on-year decline decreased from 4.9 to 1.8 percent. This follows from current Eurostat data.

The economic performance of Portugal (by 5.4 percent year-on-year), Spain (4.3), but also Germany (3.0) declined the most. Europe’s strongest economy recorded its third-largest decline within the European Union. Austria, Latvia, and the Czech Republic also recorded a year-on-year decline of more than 2%. Only France and Lithuania were able to grow year on year. Belgium and Finland also grew quarter on quarter.

Economic growth data for the first quarter of this year continued to be affected by the coronavirus pandemic, as the autumn wave of the epidemic subsided mainly at the beginning of the year. With continued vaccination, we can expect a gradual easing of anti-epidemic measures and thus recovery of the economy in many European countries.

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