'Recession of historic proportions': Eurozone economy predicted to contract 7.7%

The European Commission said today that the eurozone economy would contract 7.7 per cent this year due to the coronavirus outbreak.

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The EU called it "recession of historic proportions", but said that economies of the continent would rebound next year with 6.3 per cent growth rate next year.

While announcing the scale of the challenge, EU said Italy, Spain and France who have been the worst-affected countries due to the virus have seen their deficit sour to around ten per cent.

Meanwhile, German automaker BMW reported that its net profit was down in the first quarter due to the effect of the virus with most countries in Europe on lockdown.

The German company said it sold 21 per cent lesser cars as compared to last year with the company's chief executive adding that we are gradually ramping up our production again according to demand in each market."

"In view of the current situation, we will either put certain projects on hold or subject them to further review," the BMW chief said even as Germany sought a return to business with the opening up of the economy.

In a development that depressed sentiments further, German manufacturers reported new orders had gone down in March as the COVID-19 shut economic activity.

However, several European countries are now looking to resume economic activity after economic lockdown which has led to recession and loss of jobs as people were not allowed to go out of the house but most governments have been cautious over the opening preferring to open gradually amid fears of a second wave of the virus.