Data may show an end to Europe’s recession

The eurozone’s recession has held back exporting in the United States, Japan, and other nations and caused many companies to put investment plans on hold.

Daniel Ochoa de Olza /Associated Press

The eurozone’s recession has held back exporting in the United States, Japan, and other nations and caused many companies to put investment plans on hold.

LONDON — The recession that has gripped the eurozone since late 2011 is probably over.

On Wednesday, official figures are expected to show that economic growth for the 17-nation bloc that uses the euro inched up 0.2 percent in the April-June quarter, compared with the previous quarter.


That would be a slight increase. But it would end six straight quarters of a debilitating recession — the longest to afflict the single-currency zone since its creation in 1999.

The eurozone’s recession has held back growth in the United States, Japan, and elsewhere as European consumers and businesses spend less on imported goods.

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‘‘Concerns about the eurozone were causing a lot of companies to put investment on hold,’’ said David Owen, chief European economist at Jefferies International.

The eurozone recession was a byproduct of the debt crisis that engulfed the currency union in 2010. It forced debt-laden governments to make painful cuts, spooked investors, and raised doubts about the viability of the eurozone. Shrunken government spending and higher taxes devastated living standards in much of the eurozone, slowed economies, and drove the bloc’s unemployment rate to a record 12.1 percent.

The austerity programs embraced by the most troubled eurozone countries contrast with more expansionary efforts in the United States. The Federal Reserve has also been more active than the European Central Bank in helping the economy. It drove borrowing rates to record lows after the financial crisis erupted in 2008. Ultra-low US rates helped boost stock prices and home sales.


US unemployment has dropped to 7.4 percent from 10 percent in late 2009, despite a subpar economic recovery.

In recent months, the picture has brightened in Europe as governments have shifted their focus away from debt reduction. Industrial production is rising. Consumer spending has stabilized. Exports have increased as key trade partners, including the United States and Japan, strengthen.

Confidence has also grown as stock and bond markets have rallied. That is partly due to the European Central Bank’s pledge a year ago to do ‘‘whatever it takes’’ to save the currency union and its decision to cut its main interest rate to a record low of 0.5 percent.

In Spain and Italy, for example, government borrowing rates have declined in the past year, a sign of investor confidence. Analysts expect Wednesday’s figures to show improvement in both countries, though both are likely to have remained in recession.

Investors have bid up stock prices in key eurozone countries this year. Stock indexes in two major economies, France and Spain, have reached 52-week highs. France’s CAC 40 index has jumped 12 percent this year, and Spain’s IBEX 7 is up percent. Germany’s DAX index is up nearly 10 percent; Italy’s FTSE MIB, nearly 7 percent.

Unemployment remains at stunning highs in some countries, though — more than 26 percent in Greece and Spain, with youth unemployment of around 60 percent. Youth unemployment, in addition to hindering economic growth, is thought to contribute to crime and political extremism.

‘‘While welcome news, much of the return to growth is likely to be driven from Germany, which is likely to be cold comfort to countries like Spain, Italy, and Greece buckling under crippling levels of debt and unemployment,’’ said Michael Hewson, senior market analyst at CMC Markets.

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