Italy joins France in recession as eurozone records largest economic slump on record

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Italy has joined France in recession after its worst economic contraction for decades.

Italian GDP shrank 4.7 per cent in the first three months of the year, according to data from the Italian National Institute of Statistics. It follows a 0.3 per cent contraction in the last quarter of 2019, putting the country into a recession, as defined by two consecutive quarters of negative growth. 

Meanwhile, data from the European Union's statistics office shows that the economic output in the eurozone was 3.8 smaller in the first quarter of the year than in the three months prior. It marks the largest economic slump on record for the region. Year on year GDP decline was 3.3 per cent.

Energy prices in the eurozone were down 9.6 per cent year on year, Eurostat's preliminary data showed. Meanwhile, unemployment reached 7.4 per cent in March, up from 7.3 per cent in April.

Economists forecast that the eurozone economy could contract by around 10 per cent in the second quarter of the year.

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