Cyprus is officially in recession

As forecast by the IMF the Cyprus economy is faltering  – Cyprus is officially in recession as other EU Countries, France & German announce that they are out of recession. The Cyprus Banking sector is slowing highlighting fears for the Property Development sector as house prices fall by 30%. 

August 13, 2009 – www.financialmirror.com

Cyprus officially recorded a recession in April-June, as GDP contracted over the previous period for the second quarter in a row.

According to the latest “flash” estimate from the Statistical Service, real GDP (seasonally adjusted) contracted by 0.5% in the second quarter, having shrunk by 0.6% in the first quarter.

The economy thus met the recession criterion of two consecutive quarters of quarter on quarter decline.

 The initial estimates for the first quarter had shown zero growth rather than contraction, therefore new data coming in must have been more downbeat than the Statistical Service had initially estimated.

Compared with the same period of the previous year, real GDP also contracted, by 0.7% (seasonally adjusted) or 1.0% (not seasonally adjusted).

The detailed data will be released in a few weeks. In the meantime, the Statistical Service reported that there were “very negative growth rates” for hotels and restaurants and negative performances for manufacturing, construction, wholesale and retail trade and transport activities.

On the other hand, financial intermediation (banking) and broad services (mainly the public sector) continue to record positive growth rates but at a decelerating rate, said the Statistical Service.http://www.financialmirror.com/News/Cyprus_and_World_News/16968

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