THE European economy is crumbling all over. The output at factories in the euro zone had dipped down to 1.2 percent during the month of December that had economists back to their predictions surrounding the euro zone. With the financial crisis dampening the spirit of customers and businesses, the factory outputs had nosedived to 2.0 percent which was more than the one per cent estimate that the economists had forecast .The fourth quarter had recorded a dip to 1.8 percent and economists expected the GDP to shrink by 0.3 per cent.

The industrial production in December 2011 shows that the there was a sharp abate in the fourth quarter in the Euro Zone. A 0.8 percent drop in capital goods had then raised speculation on the investment plans of businesses. Though the economy is showing signs of recuperating but there are still challenges to undertake and overcome in the long run.