The monetary union of 19 European states continues to be rocked by the financial impact of the coronavirus pandemic. Figures for the first financial quarter of 2021 reveals the government debt to GDP ratio in the eurozone now stands at 100.5 percent, according to Eurostat, the statistical office of the European Union.
The worrying calculation means public debt now outstrips the market value of goods and services.
The debt to GDP ratio for the three months of 2021, from April to June, represents a rise of almost three percent from the previous quarter.
At the end of the last financial year the ratio in the eurozone stood at 97.8 percent.
Meanwhile, 12 months ago the eurozone debt figure was 86.1 percent in the first quarter of 2020-21, representing a rise of 14.4 percent.
The financial burden of the pandemic is also seen across the European Union.
Figures for the EU27 show the debt to GDP ratio has increased from 90.5 at the end of the last financial year to 92.9 percent in the first three months of 2021.
During the first quarter of 2020 when the pandemic first began, the ratio across EU was just 79.2 percent.
Greece has the largest economic burden with public debt more than double GDP at 209.3 percent.
Meanwhile, the ratio of government debt in Italy is at 160 percent, in Portugal it is 137.2 percent and in Cyprus it is 125.7 percent.
Debt in France also outweighs its economic output with a first quarter ratio of 118 percent.
Germany, the largest economy in the EU, has a relatively healthier debt to GDP ratio of 71.2 percent.
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Earlier today, the European Central Bank (ECB) issued a financial update and gave member states a much needed boost.
The ECB met expectations by pledging to keep interest rates at record lows for even longer to lift sluggish inflation across the eurozone.
The bank pledged not to hike borrowing costs until it sees inflation reach its two percent target.
The ECB said long periods of low inflation would require “especially forceful or persistent” policy support, a hint that stimulus might be kept in place for longer than many had predicted.
In a joint statement, Christine Lagarde, President of the ECB and Luis de Guindos, vice-president of the ECB said: “This may also imply a transitory period in which inflation is moderately above target.”
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The ECB chiefs added they expected the economy to bounce-back to pre-coronavirus levels by April-June 2022.
They added: “We expect economic activity to return to its pre-crisis level in the first quarter of next year.
“But there is still a long way to go before the damage to the economy caused by the pandemic is offset.”
Additional reporting by Maria Ortega.