Eurozone Economy Shrinks
Nine of 17 member states post a fall
By Evann Gastaldo,  Newser Staff
Posted Feb 15, 2012 9:11 AM CST
A European Union Flag flies in Athens on Monday, Jan. 30, 2012 as the ancient Parthenon temple is seen in the background.   (AP Photo/Petros Giannakouris)

(Newser) – For the first time since 2009, the eurozone economy contracted last quarter. The fourth quarter of 2011 saw the GDP shrink 0.3% compared to the third quarter; the last quarterly contraction occurred during the second quarter of 2009 when the GDP dropped 0.2%. Meanwhile, the GDP grew just 0.7% compared to a year earlier, the smallest gain since the fourth quarter of 2009. Nine of the 17 member states posted a fall, and economists are forecasting more contraction to come, the Wall Street Journal reports.

"We doubt that the eurozone will be able to avoid further contraction in the first quarter and very possibly the second" of this year, says one economist. That's partially due to government austerity measures enacted in response to the region's debt crisis. Italy, Greece, Belgium, Portugal, and the Netherlands saw two consecutive quarters of contraction, which is one of the technical definitions of a recession, and Spain was not far behind, having seen a flat third quarter.