MercoPress. South Atlantic News Agency

Euro zone officially in recession, first since founded in 1999

The Euro zone economy entered its first official recession in the third quarter, EU data confirmed in a third reading on Thursday. The bloc's combined economy shrank by 0.2% in the third quarter after contracting by the same amount in the second quarter, the Eurostat data agency said.

The slump marks the first recession, --which economists usually define as two quarters running of contraction-- that the bloc has suffered since it was formed in 1999. The 27-nation European Union escaped recession by a narrow margin with the economy shrinking 0.2% in the third quarter and flat-lining in the second quarter. On a 12-month basis, Euro zone growth slowed in the third quarter to 0.6% from 1.4% in the previous quarter. Meanwhile, consumer and executive confidence in the Euro zone economy retreated more quickly than expected in December, plunging to the lowest level in at least 23 years, according to the latest EU survey. The European Commission's economic sentiment indicator for the countries sharing the Euro fell to 67.1 points in December from 74.9 points in November, hitting the lowest level since the survey began in January 1985. The slump exceeded by expectations by economists by a wide margin for a drop to 71.3 points. The commission's indicator for the 27-nation European Union fell to 63.5 points from 70.5 points, also tumbling to the lowest level on record. The index had already hit the lowest level since the survey began in November Unemployment in the euro zone nudged higher in November to 7.8% - the highest in nearly two years. The rate, the highest since December 2006, was up from 7.7% in October and 7.2% in November 2007, revised data from the European Union's Eurostat agency showed. After gradually falling in recent years to a record low of 7.2% in March, unemployment in the Euro zone countries began creeping higher last April in the face of a deteriorating economic outlook. In the 27-nation EU as a whole, the unemployment rate ticked higher in November to 7.2% from 7.1% in October, and from 6.9% in November 2007. Eurostat estimated that 17.466 million workers were without a job in October throughout the EU, including 12.180 million in the Euro zone.