Andre Damon - Mounting Signs Of Deepening Global Slump
May 29, 2012 New economic figures point to a renewed downturn of the world economy amid a growing debt crisis in Europe and the threatened breakup of the euro zone.
The economy of the 17-member euro zone contracted sharply in May, according to the currency bloc’s purchasing managers’ index, which fell at its fastest rate since June 2009. Market, the issuer of the survey, said the figures indicate the euro zone economy will likely shrink by about 0.5 per cent in the current quarter.
The euro zone purchasing manager’s index fell to 45.9 in May, down from 46.7 in April. Germany’s index dropped to 49.6, down from 50.5, and that of France fell from 45.9 to 44.7. Figures below 50 indicate a contraction.
The euro zone’s gross domestic product remained flat in the first quarter of the year, avoiding a negative figure due only to the relatively stronger performance of the German economy, which expanded by 0.5 percent.
In May, however, even Germany’s economy likely shrank. Business confidence there fell last month to 106.9 from 109.9 in April, according to the Ifo institute, the second-biggest monthly drop since late 2008.
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