Euro zone economy narrowly skirts recession, stagnates in fourth quarter

Cargo trains stand on the railway tracks at a transshipment station in Frankfurt am Main, western Germany, as in background may be seen town’s skyline, on January 23, 2024.

Kirill Kudryavtsev | Afp | Getty Images

The euro zone economy stabilized in the fourth quarter of 2023, flash figures printed by the European Union’s statistics company confirmed on Tuesday.

The bloc narrowly averted the shallow recession that was forecast in a Reuters ballot of economists, following a 0.1% fall in GDP in the third quarter.

The euro zone’s seasonally-adjusted GDP was flat in contrast with the earlier quarter and expanded by 0.1% versus the earlier yr. In a preliminary estimate, the euro space was seen posting 0.5% progress over the entire of 2023.

Its greatest economy, Germany, posted a 0.3% contraction in the ultimate quarter of the yr, in accordance with figures additionally out on Tuesday. The nation narrowly skirted a technical recession attributable to an upwards revision to its studying for the third quarter, when the economy stagnated.

The European Commission’s euro zone sentiment indicator in the meantime confirmed a decline in client confidence — although the outlook for companies in companies and industrials was barely brighter.

The euro continued to log slim losses towards the U.S. greenback following the recent Tuesday knowledge, additionally posting tight features towards the British pound. The U.S. economy smashed expectations for the tip of the yr, expanding by 3.3% in the fourth quarter. U.Ok. figures are due out in the center of February.

The European Central Bank has hauled rates of interest to a report excessive during the last yr and a half, creating tighter monetary situations throughout the area which have helped cool inflation from a peak of 10.6% in October 2022 to 2.9% in December. The newest euro zone inflation flash figures are due Thursday.

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