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The EU economy grew by an estimated 0.4% quarter-on-quarter in the final three months of last year, according to new data, while unemployment fell, in signs of an improving economic outlook for the bloc. The Eurozone's Gross Domestic Product also headed 0.2% higher.
Data by Eurostat showed that for the year 2024 as a whole, GDP increased by 0.9% in the euro area and by 1% in the EU, after an increase of 0.4% in both zones in 2023.
Compared with the same quarter of the previous year, seasonally adjusted GDP increased by 1.2% in the euro area and by 1.4% in the EU in the fourth quarter of 2024, after a 1% increase in the euro area and 1.1% uptick in the EU in the previous quarter.
Data also showed that the number of people in work increased by 0.1% in the euro area and by 0.2% in the EU in the fourth quarter of 2024, compared with the previous quarter. In the third quarter of 2024, employment had increased by 0.2% in the euro area and had remained stable in the EU.
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The data will be welcomed by the European Central Bank (ECB), which opted to cut its key interest rate by 25 basis points on Thursday to 2.5%. The cut came with a warning, however, that choppy macroeconomic conditions may lie ahead, as US president Donald Trump threatens import tariffs.
The ECB warned of the potential impact of tariffs on trade and pressures on inflation.
The latest data comes as eurozone inflation continues to slow, with data released on Monday showing that it was expected to have fallen in 2.4% in February. While inflation was down 2.5% in January, it was above forecasts of 2.3% and still remains above the central bank's 2% target.
The ECB said: "The disinflation process is well on track. Inflation has continued to develop broadly as staff expected, and the latest projections closely align with the previous inflation outlook."
The central bank said ECB staff now see headline inflation averaging 2.3% in 2025, which was an upward revision to reflect strong energy prices.
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