"Industrial production is a timely reminder that first-quarter GDP will likely show a contraction"
- Martin van Vliet, an economist at ING
Industrial production in the Eurozone contracted unexpectedly in March, Eurostat data showed on Monday. Production fell 0.3 per cent from February, when it rose 0.8 per cent.
"Industrial production is a timely reminder that first-quarter GDP will likely show a contraction," said Martin van Vliet, an economist at ING. "With the fiscal squeeze unlikely to ease soon and the debt crisis flaring up again, any upturn in industrial activity later this year will likely be modest."
"We suspect that a further slowdown in the service sector meant that the wider economy contracted by around 0.2 percent last quarter," said Ben May, an economist at Capital Economics in London.
"What's more, April's disappointing survey data for both the industrial and service sectors suggest that the recession may continue beyond the first quarter."
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