Euro currency shrinks by massive 2.5% in the first quarter

LONDON -- The economy of the 16 countries that use the euro currency has shrunk by a massive 2.5% in the first quarter of 2009 as the recession tightens its grip.

The euro economy has now declined for four straight quarters.

Official figures show economic powerhouse Germany saw its economy shrink 3.8% as demand for its high value goods, such as cars and machinery, collapsed.

However inflation in the euro zone was unchanged at 0.6% in the year to April.