Eurozone economic growth fell to zero by the end of 2022

By: News Team

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Eurozone economic growth fell to zero by the end of 2022

The euro zone recorded no quarter-on-quarter growth in the final three months of 2022, the European statistical agency reported on Wednesday, revising its GDP and employment growth figures slightly downwards, although the latter remained strong.

Euro zone economic growth was 0.0 percent in the fourth quarter from the third quarter and 1.8 percent from a year earlier, Eurostat said in a statement. This compares with preliminary estimates of 0.1% and 1.9% published on 14th February.

The revisions confirm that the euro zone has narrowly avoided the expected technical recession.

Greece, Malta and Cyprus recorded quarterly growth of more than 1%, while Germany, Estonia, Italy and Lithuania recorded declines.

According to Eurostat, public expenditure contributed 0.2 percentage points, the change in inventories 0.1 points and foreign trade 1.0 points in net terms. The negative factors were household spending and gross fixed capital formation.

Eurostat also revised down the euro area employment growth figure to 0.3% quarter-on-quarter, instead of the 0.4% previously reported. The year-on-year figure was 1.5%, in line with previous estimates.

This brought the total number of people in employment to 165 million, 3.6 million more than at the end of 2019, just before the COVID-19 pandemic.

Strong job growth highlights the shortage of available labour and signals a problem for the ECB as it struggles to return inflation from more than 10% last autumn to 2%.

Forecasts pointed to a recession that would boost the unemployment rate, cool the labor market and keep wages at bay. However, companies, which struggled to rehire workers after the pandemic, appear to be keeping their staff even despite the slowdown.

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