The European Statistical Office (Eurostat) announced today, Wednesday, that the GDP of the eurozone recorded a growth of 0.4% in the first quarter compared to the previous three months, in a better performance than expected after the ambiguity caused by the customs duties imposed by US President Donald Trump.
Analysts whose views have signed their opinions expected a growth of 0.2% from January to March to the 20 countries that participate in the unified European currency, after growing 0.2% in the last quarter of 2024.
As for the European Union as a whole, the growth reached 0.3%, after it reached 0.4% in the period from October to December.
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This strong performance appears to be linked to previously accomplished purchases in the United States before the customs duties enter into force, but for the whole year, expectations remain dark.
Europe has recorded two years ago a state of recession, especially due to the high energy costs in the wake of the Russian -Ukrainian war.
On April 22, the International Monetary Fund reduced its expectations for the annual growth of the euro area by 0.2% to 0.8% in 2025, after 0.4% in 2024, expecting effects related to commercial tensions.
“The Sunni economy started with a stronger performance than expected. However, we expect a sharp slowdown in growth during the next six months, as the American customs duties imposed in April will affect economic activity,” said Franzeska Palm, an expert in Capital Economics, said on Wednesday.
Several companies shipped more goods at the beginning of the year to avoid the additional customs duties imposed by Donald Trump.
Thus, exports from Ireland to the United States increased by 210% in February, 90% of which are chemicals and medicines.
Palmas noted that the strong performance of the European economy in the first quarter “is partly due to the increase of 3.2% in GDP in Ireland, as the resulting payment was probably significant.”
The economic activity in France recorded a slight improvement of 0.1% in the first quarter of 2025, while the recession of the consumption of families and the decline in investments in curbing growth, according to what the National Institute for Statistics and Economic Studies announced today, Wednesday, in a preliminary estimate of this stage.
This moderate increase in the growth of GDP between January and March came in line with the institute’s expectations, and it was recorded after a decrease of 0.1% in the last quarter of 2024 due to the effect of Paris Olympic hosting.
During the first quarter of 2025, the growth of France, the second largest economy in the eurozone, suffered a weakness in the consumption of families, which recorded stability at 0.2% during the previous three months.
Investments continued to decline by 0.2% after a decrease of 0.1% in the previous quarter, whether at the level of families or public administrations.
Foreign trade contribution was also negative, with a decline of 0.4 percentage points due to a significant decrease in negative exports 0.7%, while exports increased by 0.4%.
Germany
In Germany, today’s data indicated that the economy grew in the first quarter of the year by supporting consumption and investment, leaving from slipping into a stagnation, but the unemployment rate rose to its highest levels in about 10 years in an indication of the extent of the labor market affected by the weakness of the economy.
According to the initial data issued by the Statistics Office, GDP increased 0.2% on a quarterly basis, which came in line with expectations.
The German economy shrinks 0.2% in the last quarter of last year, and this was renovated from the recession, a term indicating a decline in growth in two consecutive quarterly.
Germany is the only member of the seven -year -old group that has not been growing during the past two years, and the customs duties announced by Trump will be a strong blow, as it may make it on the path of a third year of recession for the first time.
Separate data issued by the labor office today showed that the number of unemployed in Germany increased in April at a lower rate than expected, but the unemployment rate has risen to its highest level since the time of the pace.
The office stated that the number of unemployed increased 4 thousand people after the amendment in light of the seasonal factors to 2.92 million, and it is not far from the level recorded in March, and analysts have polled Reuters who signed an increase of 15,000.
The number of unemployed in Germany is close to reaching the three million people’s barrier for the first time in 10 years.
The unemployment rate was modified in light of the seasonal factors by increasing to 6.3% from 6.2% in the previous month, and with the exception of the period of the pandemic, this is its highest level since December 2015.
