The Eurozone is back in recession. This second downturn is wide-ranging and we see little support of aggregate demand. Regional differences in manufacturing performance persist, and total industrial output fell 2.3 percent in the third quarter in the Eurozone and 2.7 percent in the EU27. Slovakia, Lithuania, and Latvia spearheaded the group, with growth in excess of 8 percent annually, followed by Denmark, Poland, and Austria, with growth in the 1-3 percent range. Manufacturing sectors of the remaining EU economies are mired in recessions. In the Eurozone, intermediate goods and consumer durables bore the brunt of output attrition in the third quarter. Somewhat surprisingly, production of capital goods has softened only slightly over the past year, buoyed by external demand from Asia and the Middle East.

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