Euro zone growth slows to 0.4% in Q3 as France contracts amid debt crisis
Euro zone GDP growth decelerated to 0.4% in the third quarter, down from 0.6% in the previous quarter, though it exceeded the 0.2% forecast. France’s economy contracted by 0.1% due to political deadlock over its budget deficit, while Germany grew by 0.2% and Italy stagnated. Spain expanded by 0.6%, and Ireland recorded 5.5% growth, though its figures are volatile due to multinational corporate activity. The European Central Bank held interest rates steady on October 29, citing no second-round inflation effects from energy shocks, but analysts expect a potential rate hike in December. Inflation remains at 3.8%, above the 2% target. The region faces structural challenges including weak productivity and demographic pressures, despite showing resilience against geopolitical turmoil.
