The eurozone economy contracted at a record rate in the first three months of the year and inflation slowed sharply as much economic activity in March came to a halt because of the COVID-19 pandemic, data showed on Thursday.
Economists expect even worse numbers for the second quarter.
According to a preliminary flash estimate from the European Union’s statistics office Eurostat, economic output in the 19 countries sharing the euro currency in January-March was 3.8% smaller than in the previous three months – the sharpest quarterly decline since the time series started in 1995.
Economists polled by Reuters had expected a 3.5% contraction after a 0.1% quarterly growth in the last three months of 2019.
Economists said they expected that number to increase in the coming months, despite a European Union scheme to help subsidise wages across the 27-nation bloc so that employers cut working hours rather than jobs.
European Commissioner for Economic and Financial Affairs Paolo Gentiloni said the GDP data showed Europe was experiencing an economic shock without precedent in modern times.
“This is why we need a recovery plan that is sufficiently large, targeted at the hardest-hit economies and sectors, and deployable in the coming months,” he said, referring to a plan to help finance an economic recovery in the bloc.
