Downturn spreading to the core

The euro-zone may have narrowly avoided falling back into recession around the turn of the year, but timelier data have revealed that economic prospects are deteriorating. Activity surveys, such as the composite PMI, now point to pretty sharp falls in GDP. And April’s hard data have also been unambiguously weak. With unemployment rates now rising in most core economies and German business sentiment starting to deteriorate, policymakers’ attempts to stimulate growth look set to be too little too late.