Dailyfx Insight: European Economic Releases Disappoint, Reinforcing a Dour Outlook for Future Growth

Economic activity in the Euro-Zone fell at a record pace in the first quarter as the advanced GDP reading showed that the economy contracted 2.5% from the previous quarter, while the annual rate of growth plunged 4.6% from last year to mark the biggest downturn since the series began in 1995. Meanwhile, economic growth in Germany and Italian fell the most on record as first quarter GDP slipped -3.8% and -2.4%, respectively. Meanwhile, the headline reading for Euro-Zone inflation held steady at 0.6% in April, while the core CPI rose to 1.8% from a revised 1.4% in the previous month, which remains below the ECB’s 2% target for price stability. The downturn in the global trade paired with the slowdown in domestic activity has certainly dragged on the economy throughout the first half of the year, and the outlook for the euro-region remains bleak as the IMF forecasts the annual rate of growth to contract 4.2% this