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7h ago

Eurozone Growth Edges Up to 0.2% in Q3, Topping Forecasts Ahead of ECB Decision

Markets expect the ECB to keep its deposit rate at 2% today.

Skyscrapers stand on the skyline in the La Defense business district, viewed from the Ballon Generali de Paris hot air research balloon during air quality checks, over the Park Andre-Citroen in Paris, France, April 29, 2025. REUTERS/Benoit Tessier
People walk over a bridge near the European Central Bank in Frankfurt, Germany, Sunday, Oct. 26, 2025. (AP Photo/Michael Probst)
FILE - President of the European Central Bank Christine Lagarde briefs the media during a press conference at the bank's headquarters in Frankfurt, Germany, Thursday, Sept. 11, 2025. (AP Photo/Michael Probst, File)
Despite political instability over massive debt and deficit, the French economy grew by 0.5 percent in the third quarter

Overview

  • Flash Eurostat data showed the 20-country bloc grew 0.2% quarter on quarter, beating ~0.1% forecasts after 0.1% in Q2.
  • National results diverged as France rose 0.5% and Spain 0.6% while Germany and Italy posted zero growth, with Germany avoiding a technical recession after a 0.2% contraction in Q2.
  • The wider 27-country European Union recorded 0.3% growth in the quarter.
  • Inflation stood at 2.2% in September near the ECB’s 2% goal, and the bank last cut its deposit rate to 2% in June.
  • Economists caution against calling a durable upturn, pointing to France’s political uncertainty, structural weaknesses in Germany, and U.S. tariffs on European goods.