The euro area economy grew at a steady pace in the fourth quarter despite geopolitical and economic tensions, official data revealed on Friday.
Gross domestic product rose 0.3 percent sequentially, the same rate of growth as seen in the third quarter, preliminary flash estimate published by Eurostat showed on Friday. The rate was also slightly stronger than economists’ forecast of 0.2 percent.
Year-on-year, GDP moved up 1.3 percent but weaker than the 1.4 percent expansion seen a quarter ago. GDP was expected to grow 1.2 percent.
ING economist Bert Colijn said the currency bloc ended 2025 with decent economic growth despite significant uncertainty and economic tension.
“For 2026, the mood is becoming more upbeat as investment plans should result in a modest cyclical improvement, but beware of structural concerns,” the economist added.
Economic growth accelerated in Germany, Spain and Italy but the pace of expansion weakened in France.
The German economy logged a better-than-expected growth in the fourth quarter, driven by increased household and government spending. GDP grew 0.3 percent after remaining flat in the third quarter.
This was the first expansion in three quarters and exceeded the forecast of 0.2 percent.
Spain’s economic growth accelerated on household spending and investment. GDP rose 0.8 percent from the third quarter. A similar faster growth was last reported in the fourth quarter of 2024.
GDP growth was expected to be 0.6 percent in the fourth quarter, which was the same rate as reported in the third quarter.
Italy’s economy expanded for the second straight quarter in the three months ending in December. GDP advanced 0.3 percent sequentially, following a 0.2 percent increase in the third quarter.
On the other hand, the French economy grew at a slower pace towards the end of the year as political and fiscal uncertainty weighed on investment and consumption.
French GDP posted a quarterly growth of 0.2 percent in the fourth quarter. The rate came in line with expectations and followed third quarter’s 0.5 percent expansion and the 0.3 percent rise in the second quarter.
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