Eurozone Economy Manages To Expand In Q4

(RTTNews) - Euro area managed to grow at the end of the year, as initially estimated, raising hopes that the region could avert a technical recession, official data revealed Tuesday.

The currency bloc logged a quarterly expansion of 0.1 percent in the fourth quarter, which was unchanged from the previous estimate released on January 31, the statistical office Eurostat said.

The pace of growth slowed from 0.9 percent in the second quarter and 0.3 percent in the third quarter. The breakdown of GDP is currently unavailable. Eurostat publishes GDP estimate and main aggregates on March 8.

Year-on-year, gross domestic product grew 1.9 percent, following 2.3 percent in the preceding period. The annual rate was also left unrevised from the preliminary flash estimate.

Confirmation that euro-zone GDP growth slowed to a crawl in the fourth quarter does not alter the view that the region is now falling into recession, Franziska Palmas at Capital Economics said. That said, the labor market will continue to hold up well, the economist added.

However, the European Commission on Monday said the euro area is set to avoid a recession this year following the favorable development in energy prices and the diversification of supply sources. In the Winter Interim Forecast, the EU upgraded its economic growth outlook for the currency bloc to 0.9 percent from 0.3 percent this year. Growth is seen at 1.5 percent in 2024.

Employment increased by 0.4 percent from the preceding quarter and advanced 1.5 percent from the same period last year, Eurostat said.

The EU27 GDP remained flat sequentially and expanded 1.8 percent on a yearly basis. The statistical office confirmed the fourth quarter GDP rates.