Freight containers stacked in the east of the bank city at the DB transfer station site. Skyscrapers on the bank skyline behind them. U.S. President Trump’s radical U.S. customs policy can also be seen as a trade war against the rest of the world.
Arne Dedert/Picture Alliance Photos by Getty Images
Eurozone economy grew 0.4% more than expected in the first quarter as global tariff tensions created uncertainty on the group's trajectory, according to Flash data from the European Statistics Bureau on Wednesday.
Reuters surveyed economists after forecasting a 0.2% expansion in the first three months of the previous three months, following a 0.2% increase in the last quarter of 2024.
Data released earlier on Wednesday showed that Germany's GDP, the largest economy in Europe, rose 0.2% over the same period. France's GDP increased by 0.1% over the course of three months.
Continuing the recent trend, Southern Europe and smaller economies performed poorly, with Spain and Lithuania each increasing GDP by 0.6%, while Italy's economic output increased by 0.3%. Due to its high proportion of multinational corporations, the Irish economy tends to have fluctuating readings, which grew 3.2% in the first quarter.
Eurozone economic growth has been boring for much of 2023 and 2024, although the European Central Bank has been lowering interest rates to stimulate growth and promote economic activity. The ECB's deposit facility rate (its key interest rate) was lowered to 2.25% at the beginning of the month, down from 4% in mid-2023.
The ECB said in March that the eurozone economy is expected to grow by 0.9% in 2025, slightly lower than its January forecast. New forecasts will be held in June, with central bank decision makers last week proposing forecasts to CNBC, which are crucial to the interest rate decision process.
Amid the IMF's World Bank Spring Meeting, policy makers and other economists and officials have broadly pointed out that U.S. tariff policy is a key issue when it comes to growth.
ECB President Christine Lagarde The impact will "weak" GDP.
The European Union, including euro zone countries, faces a 20% blanket trade tariff from the United States, which briefly reduces the measures with taxes from other counterparties until negotiations are held in July. The EU has also temporarily suspended its retaliation measures. The group also requires additional tariffs on steel, aluminum and automobiles.
However, data released on Tuesday showed that economic sentiment in the eurozone fell in April, reaching its lowest level since December 2024.
While growth has been shortened, inflation in the eurozone is close to the 2% target of the ECB, with a target of 2.2% in March. The latest inflation data release will be released later this week.
This is a shocking news story, check out the update.