The eurozone surprisingly stagnated in the fourth quarter of last year, the latest data showed.
Europe’s economic woes show no sign of abating. Quarterly GDP growth in the single currency area fell sharply from 0.4 percent to zero percent in the final three months of 2024, Eurostat said.
Economists polled by Bloomberg had forecast eurozone growth of 0.1 percent.
The eurozone’s poor performance was largely due to economic downturns in Germany and France, the bloc’s two largest economies, which shrank by 0.2 percent and 0.1 percent respectively.
Italy, the bloc’s third-largest economy, also stagnated for a second straight quarter. By contrast, Spain, the bloc’s fourth-largest economy, grew by 0.8 percent for the third straight quarter.
Eurostat data showed consumers were still “recovering from the inflationary shock” caused by Russia’s invasion of Ukraine in 2022, said Bert Colijn, an economist at ING Research.
Low levels of investment, weakness in production and general “economic uncertainty” contribute to Europe’s economic problems, he added.
– At the moment, the economy seems to be in a slump and we don’t expect it to come out of it this winter. Domestic demand is likely to “drive some economic growth” later in the year, Colijn said.
