New Data: European Economy Skidding

The EU performed middlingly out of the big three economies, with US GDP declining 0.1 percent and Japanese GDP down 0.5.

In the second quarter, the eurozone's growth rate had also been -0.2 percent, meaning that the region is officially in its first recession since the launch of the euro, as economists defined a recession as two quarters in a row of decline.

A stark series of data released on Thursday certify the grim state of the European economy, with unemployment up, GDP sliding, and both economic sentiment and business climate indicators reaching all-time lows.

The eurozone's gross domestic product declined by 0.2 percent in the third quarter of 2008 compared with the previous quarter, according to estimates from Eurostat, the EU's statistics office.

The wider EU also saw a GDP decline of 0.2 percent in the third quarter, according to additional Eurostat figures. The bloc as a whole narrowly escaped recession, as in the second quarter, growth stagnated at 0.0 percent.

Slovakia recorded the highest growth out of all EU member states in the third quarter, on an aenemic 1.5 percent, followed by Ireland and Poland (both grew by 1.2%).

A limp blip in household consumption however in the third quarter was some of the only good news to be issued by the Eurostat office, remaining flat, but not declining in the eurozone and rising by 0.1 percent in the EU overall.

The positive figures come after a slide of -0.2 percent and -0.1 percent respectively in the second quarter.

German exports fall off the cliff

Exports remained unchanged in both the eurozone and the wider EU after the previous quarter's drop of -0.1 percent in both.

However, German exports fell off the cliff, plunging record 10.6 per according to the country's own statistical office. The sudden collapse of German exports is all the more surprising given the marginal decline of only 0.6 percent in October.

Meanwhile, investment fell by 0.6 in the euro area and 0.8 percent across the EU.

Unemployment in the eurozone meanwhile climbed slightly in November last year, according to Eurostat, up to 7.8 percent from 7.7 percent the previous month.

Across the EU, unemployment rose to 7.2 percent, up from 7.1 percent in October, for a total of some 17.5 million men and women out of work.

Joblessness grew for the first time in three years in Germany, climbing to 7.6 percent in December, up slightly from 7.5, according to stats from the German Federal Labour Agency.

Third of Spanish youth unemployed

Unemployment has however galloped apace in Spain, the EU member state with the most jobless—with unemployment rising 47 per cent to reach 3.1 million in December, according to Spanish labour ministry figures also issued on Thursday, bring the total to 13.4 percent of the country's working-age people.

Spanish commentators predict the figure to climb to 17 percent in coming months. The figures are particularly worrying when it comes to young people in the Iberian country, which is home to the highest youth employment rate (of people under the age of 25) in the EU, on 29.4 percent.

Sweden also has been beset with spreading unemployment amongst the young, with 23.8 of them unable to work.

Youth joblessness climbed up firmly across the EU and the eurozone, at 16.4 percent for both, up from 14.7 percent and 14.5 respectively.

The lowest youth unemployment rates were seen in the Netherlands (5.4%) and Austria (6.9%). The lowest unemployment rates overall were also found in the Netherlands (2.7%) and Austria (3.8%), alongside Cyprus (3.9%).

US unemployment for November last year was lower than on the Old Continent, on 6.7 percent, while Japan's unemployment rate was lower still, on 3.9 percent.

Confidence lowest since 1985

Additionally, the Business Climate Indicator survey of industry for the eurozone fell sharply in the last month, reaching its lowest level since 1985.

According to the European Commission, this continued steep decline of the indicator signals a deteriorating trend in industrial production growth, with managers reporting a sharp fall in production and stocks of finished goods increasing.

Economic confidence also slid considerably in the EU and across the eurozone, as measured by the Economic Sentiment Indicator, following on from marked drops seen in surveys in October and November. Here too, the ESI is at its lowest level since 1985.

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