Output in the euro area has recently been recovering from the 2000-01 slowdown. Growth had decelerated progressively from its peak in the first half of 2000, and turned negative in the fourth quarter of 2001. The slowdown was prompted by a series of shocks, most of them common to the OECD area. Aside from the 11 September events, these included the surge in oil prices in 1999-2000, the bursting of the ICT bubble and the ensuing slump in stock markets. The sharp downturn in foreign demand aggravated the situation. As a result, economic growth declined from 3½ per cent in 2000 to 1½ per cent in 2001, although the policy easing during the year cushioned the downturn to some extent.