Stay updated with free updates
just sign up eurozone economy myFT Digest – delivered straight to your inbox.
The eurozone economy unexpectedly grew by 0.3 percent in the fourth quarter of 2025 despite geopolitical tensions and widespread uncertainty.
The pace of growth was better than the 0.2 percent expected by economists and in line with the 0.3 percent recorded in the previous three months. The eurozone economy has now expanded for nine consecutive quarters.
The European Central Bank recently raised its GDP forecast for this year to 1.2 percent, and is widely expected to leave interest rates unchanged at 2 percent at its first meeting until 2026 next week.
ECB President Christine Lagarde has repeatedly praised the economic “resilience” of the eurozone, with growth proving stronger than forecast through early 2025 despite US President Donald Trump’s tariffs.
Germany, Europe’s largest economy, expanded last year for the first time since 2022 and is expected to accelerate further as the government borrows heavily to invest in infrastructure and defense.
The euro was little changed after the data, falling 0.5 percent to $1.191 against a broadly stronger dollar.
Traders’ interest rate expectations have also barely changed, with a roughly 25 percent chance of a quarter-point cut this year, according to swap markets.
This is a developing story
