Eurozone Economy Struggles as GDP Growth Revised Down to 0.0% in Q4 2022
The euro-area economy failed to expand in the fourth quarter of 2022, according to the latest data released by Eurostat, the statistical service of the EU. The initial growth reading was revised down to 0% due to weaker-than-expected performances in Germany and Ireland. This marks a slowdown in the economic performance of the euro-area compared to the previous quarter when GDP grew by 0.4%.
Greece was the highest performer in the fourth quarter of 2022, with an increase of 1.4% in its gross domestic product (GDP) compared to the previous quarter, followed by Malta (+1.2%), Cyprus (+1.1%) and Romania (+1.1%). On the other hand, Poland had the biggest decrease in GDP (-2.4%), followed by Estonia (-1.6%) and Finland (-0.6%).
On an annual basis, the European Union’s economy grew by 1.7 percent in the last three months of 2022, 0.1 percentage point lower than previous Eurostat estimates showed. Both the euro area and the EU saw their GDPs increase by 3.5% in 2022, following a growth of 5.3% and 5.4% respectively in 2021.
In 2021, both the eurozone and the European Union experienced a 5.3% and 5.1% increase in GDP respectively. This number was smaller, yet still positive, in 2022 with a 3.5% increase in both areas. In 2022, ELSTAT in Greece declared that GDP had risen by 5.9%, following an 8.4% increase the year before.
Employment rose by 3.0% in Cyprus in the fourth quarter of 2022 (+1.5% in the euro area and +1.3% in the EU), after growing 3.1% in the third quarter of 2022 (+1.8% in the euro area and +1.5% in the EU).
Recently, sentiment regarding the economy in the eurozone has become more optimistic as a result of the avoidance of many unfavorable economic outcomes. It has become evident, as more data has been collected, that the economy of the eurozone is facing difficulties; with GDP growth being lowered to 0.0% in the fourth quarter. When we take a closer look at the GDP release, a more worrisome situation is exposed.
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