For the euro area, GDP had an unprecedented decline of 3.6% in the first quarter of this year, which is a sharper contraction than was seen during the global financial crisis. (Figure 1: Euro area GDP growth (quarter-on-quarter, %)) Higher frequency PMI data shows the sharp contraction has continued through the second quarter.
There has also been a sharp deterioration in labour markets across the euro area, feeding through to incomes and to consumption patterns. These developments, among others, have caused sharp downward revisions in the recent macroeconomic projections for the euro area, released by Eurosystem staff.