According to preliminary figures from the European official statistics agency Eurostat, economic growth in the Eurozone and across the EU slowed significantly in the third quarter of 2022 compared to the same period a year earlier and the prior three months.
Compared to the second quarter, when it increased by 0.7%, the Eurozone’s GDP grew by 0.2% from July to September 2022, meeting the consensus forecast of the financial markets. This indicates that GDP may contract in the final quarter of the current year as the continued acceleration of inflation to record highs will force the ECB to maintain its current aggressive policy of tightening interest rates. This is the weakest expansion since the economic recovery when Covid restrictions were reduced in the second quarter of 2021.
Almost all of the Eurozone’s members have experienced a slowdown in economic development during the third quarter, with Latvia’s GDP declining by 1.7% and Austria’s and Belgium’s each declining by 0.1%. Sweden experienced the most substantial economic growth in the third quarter (with 0.7% growth compared to the previous three months), followed by Italy (with 0.5% growth compared to the second quarter’s 1.5% growth), Portugal, and Lithuania (with 0.4 per cent each).
Only the largest of the four major economies—Germany—saw growth drop slightly in the third quarter, stagnating at 0.3% after increasing by 0.1% in the previous three months. France’s GDP grew by 0.2% after rising by 0.5% in the second quarter, and Spain’s growth slowed dramatically to just 0.2% from 1.5% in the April-June period.
Following a double-digit growth of 4.3% in the current year’s second quarter, the euro area’s and the EU’s GDP increased by 2.1% and 2.4%, respectively, between July and September of this year compared to the third quarter of 2021.
Portugal recorded the most significant gains (4.9%), followed by Spain (3.8%), Italy (2.65), Sweden (also 2.6%), and Lithuania (2.5%). Germany’s GDP growth decreased from 1.7% in the second quarter of 2022 to 1.1% in the third quarter compared to a year earlier.
