- Paul De Grauwe, an economist with the London School of Economics
The eurozone economy returned to recession, as the output across the region was hit by the deepening sovereign debt crisis. According to the Europe's statistics office, Eurostat, GDP of the 17-nation bloc shrank by 0.1% between July and September, after contracting by 0.2% in the prior quarter. The eurozone slipped into a recession for the second time since 2009, when the economy contracted for five consecutive quarters. German's GDP growth slowed to 0.2%, down from a 0.3% expansion in the previous quarter, while Spanish and Italian economies contracted 0.3% and 0.2%, respectively.
"We are now getting into a double dip recession which is entirely self-made," said Paul De Grauwe, an economist with the London School of Economics.
"This was totally expected because of austerity policies combined with world growth slowing down and a dramatic fall in activity in Germany and the Netherlands," said Steen Jakobsen, chief economist at Saxo Bank.
The Stoxx Europe 600 Index lost 0.98 per cent to 265.52. Germany's DAX Index fell 0.82 per cent to 7,043.42, while France's CAC 40 Index dropped 0.52 per cent to 3,382.40.
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