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OECD: Recession 'taking hold' in eurozone

Author: Associated Press All articles by this author

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Sep. 06, 2012 12:42
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A woman sleeps in front of a closed shop window in Rome, Thursday, Aug. 16, 2012. Europe is edging closer to recession, dragged down by the crippling debt problems of the 17 countries that use the euro. Eurostat, Europe's statistics agency, revealed that the economies of both the eurozone and the European Union, which has 27 countries, shrank by a quarterly rate of 0.2 percent in the second quarter of the year.
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PARIS — The Organization for Economic Cooperation and Development says global growth is being dragged down by the economic problems of the 17 countries that use the euro, where a recession is "taking hold." 

An interim report from the OECD released Thursday predicts that even the eurozone's powerhouse, Germany, could to slip into recession by the end of the year.

In May, the OECD said that the 17-country eurozone could contract by as much as 2 percent this year. Thursday's assessment didn't offer a comparable prediction. Instead, the report predicts the three largest euro economies — Germany, France and Italy — will shrink by 0.2 percent this year.

Chief economist Pier Carlo Padoan said he was waiting "anxiously" for details on the European Central Bank's plan due later Thursday on buying government bonds to help alleviate the crisis. 

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