EU and Eurozone on the Brink of Stagnation in the First Quarter

The economy of the Eurozone and the EU has only slightly increased in the first quarter, Eurostat reported on Tuesday, slightly lowering its growth forecast for the Union level.

Seasonally adjusted gross domestic product (GDP) in the 20-member Eurozone grew by 0.1 percent in the first quarter compared to the previous quarter when it stagnated, Eurostat announced.

In the EU, GDP increased by 0.2 percent, which is 0.1 percentage points weaker than Eurostat had forecasted at the end of April. In the last three months of last year, it decreased by 0.1 percent.

On a year-on-year basis, activity in the area of the common European currency increased by 1.3 percent at the beginning of the year, following a 1.8 percent growth in the fourth quarter of 2022.

The EU economy grew by 1.2 percent, which is 0.1 percentage points weaker than Eurostat estimated in April. At the end of last year, it increased by 1.7 percent.

Jump in Poland

Among the countries for which Eurostat had data, the highest growth in activity in the first quarter compared to the previous three months was recorded by Poland, at 3.9 percent.

Portugal follows with a quarterly growth rate of 1.6 percent.

The activity in Czech Republic and Romania increased the least compared to the previous three months, by 0.1 percent. In Germany, the economy stagnated. The largest decline in economic activity on a quarterly basis was recorded in Lithuania, at three percent. Ireland follows with a decline in activity of 2.7 percent. Eurostat did not have data for Croatia, Estonia, Greece, Luxembourg, and Malta.

The Four with Declining Activity

On a year-on-year basis, the highest growth in activity was recorded in the first quarter, according to Eurostat’s available data, by Spain, at 3.8 percent. Cyprus follows with an activity growth of 3.4 percent. The activity in Latvia and Sweden increased the least, by 0.3 percent. The Polish economy stagnated. The largest decline in activity compared to the first quarter of last year was recorded by Lithuania, at 3.6 percent.

Activity also decreased in Hungary, the Czech Republic, and Germany, by 1.1 percent, 0.2 percent, and 0.1 percent, respectively.