The Eurozone economy stagnated and the European Union’s Gross Domestic Product (GDP) contracted in the last three months of 2022, Eurostat data also show.
The GDP growth recorded by the 19 countries that switched to the euro currency was unchanged in the fourth quarter compared to the third quarter, but increased by 1.8% year-over-year, in line with revised data released by Eurostat.
Eurostat’s initial estimates released in February showed that the euro zone economy grew by 0.1% from one quarter to another and by 1.9% year-over-year. Even if the revised data is bleaker than initially expected, a standstill means the EU bloc could still avoid entering a recession, defined as two consecutive quarters of falling GDP, which seemed inevitable after Russia invaded Ukraine.
Analysts are currently forecasting a contraction in eurozone GDP in the first quarter of 2023 as the rising cost of living continues to weigh on consumers. Regarding the European Union as a whole, the revised data show that the Gross Domestic Product decreased by 0.1% from one quarter to another, but increased by 1.7% year-over-year. Comparatively, in mid-February, Eurostat data showed that the EU GDP inched up 0.1% from one quarter to another and advanced 1.8% year-over-year.