Euro zone economy shrank in Q3

The economy of the 17-member euro zone contracted 0.1 percent in the third quarter, the Eurostat statistics office said Thursday.

Spain, the fourth-largest euro zone nation, saw its economy shrink by 0.3 percent compared with the second quarter and by 1.6 percent from June-September of 2011.

At least seven of the 27 European Union countries were in recession in the third quarter, including euro zone members Spain, Italy, Portugal and Greece.

Lisbon and Athens have been forced to impose harsh austerity policies in exchange for EU help in paying their creditors, while Madrid has engaged in voluntary belt-tightening without seeking a bailout from Brussels.

Ireland, also subject to EU-mandated austerity, technically emerged from recession in the third quarter, but unemployment remains high, though well short of the 25 percent jobless rate in Greece and Spain.

The Eurostat report also showed that the Dutch economy shrank 1.1 percent in the third quarter.

Germany, Europe's economic giant, logged growth of 0.2 percent in the June-September period, down from 0.3 percent in the second quarter.
The No. 3 euro zone economy, France, grew 0.2 percent after slipping 0.1 percent in the previous quarter.

The one bright spot in Thursday's data was non-euro-member Britain, which posted an expansion of 1 percent after declines in the first and second quarters.