(Bloomberg) -- Virus lockdowns and the closure of shops, bars and hotels sent consumer spending in the euro area plunging in the second quarter.
Household expenditure dropped 12.4% in the three months, accounting for more than half of the record slump in the economy, according to figures from Eurostat published Tuesday. Investment and exports also declined, and even government consumption slipped.
The economy's second-quarter contraction was revised to 11.8% from 12.1%, a marginal improvement that doesn't change the overall picture.
| Category | 2Q Change | Contribution |
|---|---|---|
| GDP | -11.8% | --- |
| Consumer spending | -12.4% | -6.6 percentage points |
| Government spending | -2.6% | -0.6 percentage point |
| Investment | -17.0% | -3.8 percentage points |
| Exports | -18.8% | -9.1 percentage points |
| Imports | -18.0% | +8.1 percentage points |
| Employment | -2.9% | --- |
The euro-region economy has since staged a strong rebound, and is forecast to grow about 8% this quarter. But that initial spurt won't be sustained, and there's a risk of a surge in unemployment as governments scale back some support programs and more businesses go under.
That backdrop is one for European Central Bank policy makers to assess at their meeting this week. While no change to emergency stimulus is expected on Thursday, economists will be looking for clues about a potential expansion of bond buying later this year.
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