Eurozone Now Enjoying Anemic Growth

The recession ends in Europe though this isn’t much of a recovery:

The E.U.’s statistics agency, Eurostat, reported that G.D.P. growth in the 16-member euro zone improved by 0.4 percent from the second quarter, following five consecutive quarters of contraction. Growth was still 4.1 percent lower than a year earlier.

The rebound appeared to be powered by Germany. There, G.D.P. growth rose by 0.7 percent from the second quarter, when it was up by 0.4 percent. Compared to a year earlier, German G.D.P. was down 4.7 percent.

That these kind of numbers can signal the end of a recession mostly shows the somewhat arbitrary significance of the number zero. Those are terrible growth numbers, and imply that labor market conditions are getting worse. What’s more, a place like Spain is currently experiencing depression-like conditions and the European Central Bank seems to be looking for any kind of vague excuse to halt expansionary policies. This kind of just-barely-above-zero growth might turn into the ECB’s opportunity to step on the breaks, which would be a terrible idea.