Eurozone Defies Slowdown Fears: Q4 GDP Beats Estimates at 0.3% Growth

Market snapshot: The Eurozone economy demonstrated unexpected resilience in the final quarter of 2025, maintaining a growth rate of 0.3% quarter-on-quarter. This performance surpassed the consensus analyst estimate of 0.2%, matching the growth seen in the preceding quarter. The data suggests that despite significant global uncertainty and tightening credit conditions, the monetary union has avoided the stagnation many economists had feared for the year-end.

Summary: Eurozone Q4 GDP grew by 0.3%, outperforming the 0.2% estimate. Stability in major economies like Germany and Spain offset a slower performance in France, providing a solid foundation for the ECB's upcoming rate decisions.

Key Takeaways

• Q4 GDP growth held steady at 0.3%, beating consensus forecasts of 0.2%.
• Germany, Spain, and Italy showed accelerating growth momentum, balancing out a sluggish French economy.
• The surprise outperformance gives the ECB flexibility to maintain current interest rates (2.0%) at the February meeting.

SAHI Perspective

From a SAHI lens, this macro print is a 'Goldilocks' signal for European equities. It is strong enough to avoid recession fears but not so hot that it triggers immediate hawkish panic. The consistency in growth (0.3% for two consecutive quarters) reflects a stabilizing internal demand environment. For Indian exporters to the EU, this indicates a steady, albeit modest, recovery in purchasing power within their largest trading partner bloc.

Closing Insight

The Eurozone enters 2026 on a firmer footing than expected. Investors should watch the ECB's Feb 5 meeting for clues on whether this resilience will accelerate or if high rates will finally start biting into 2026 output.

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