EU to shrink further into recession


Recession in the crisis-hit eurozone will be deeper than expected for the rest of the year, with even some of Europe’s biggest economies suffering from hardships.

The EU warned on Friday that unemployment would reach record levels as four of the eurozone’s biggest economies, France, Italy, Spain and the Netherlands, continue to see negative growth.

With signs of recovery still lacking, eurozone members are caught in a fierce debate over the way out of the crisis, with hard-hit countries to the south clamouring for an end to austerity policies championed by Germany and like-minded states to the north.

Italian Prime Minister Enrico Letta made it clear during his meetings this week with German Chancellor Angela Merkel and French President François Hollande that he thought Italy should move away from austerity and towards growth and jobs.

IMF chief Christine Lagarde, however, said on Thursday at the spring meeting of the IMF and World Bank, that she…

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