Euro area moves closer to recession but not US

The euro area appears to be on the brink of another recession after the latest GDP report showed that the economy shrank 0.2 percent in the second. The quarter had ended with eurozone industrial production falling 0.6 percent in June.

Second quarter GDP in the euro area had been kept up by Germany, who managed to grow 0.3 percent. However, the German economy looks likely to weaken further after another report on Tuesday showed that the ZEW economic sentiment indicator fell to -25.5 in August from -19.6 in July, the fourth successive decline.

While Europe edges closer to recession, fears of a recession in the US receded for the time being after retail sales there jumped 0.8 percent in July, its first gain in four months.

But even as economists consider the odds of recession in the major economies, inflation continues to linger in places like the UK. A report on Tuesday showed that UK consumer price inflation rose to 2.6 percent in July from 2.4 percent in June.