Eurozone economy stagnated in the fourth quarter

By: Trademagazin Date: 2025. 01. 30. 12:32

Contrary to analysts’ expectations, the eurozone economy stagnated in the fourth quarter of 2024, Eurostat’s latest report revealed. Preliminary analyses had projected growth of just 0.1%, but even this slight expansion did not materialize.

One of the main reasons for the weak performance is that the two largest eurozone economies, Germany and France, also recorded a decline. The German economy shrank by 0.2% and the French economy by 0.1%, while Italy and Austria did not show growth either. The performance problems of German industry are affecting the economy of the entire region, which further worsens the outlook.

Negative outlook and political risks

The future economic outlook is not particularly favorable either. Threats from the United States, including punitive tariffs imposed by Donald Trump, are also putting additional pressure on the eurozone economy. In France, economic stagnation is attributed to the costs of the Paris Olympics, subdued consumption and stagnant corporate investment, according to analysts. In addition, a government crisis developed in both France and Germany at the end of the year, which further worsened economic stability.

Hungary exits recession

In parallel, according to the Central Statistical Office (KSH), the Hungarian economy grew by 0.4% in the fourth quarter of 2024 according to raw data, while it exceeded the same period of the previous year by 0.2% based on seasonally and calendar adjusted data. This means that the Hungarian economy has officially exited recession.