According to Eurostat’s estimates, economic growth in the European Union remained positive but slowed during the first quarter of 2026. Seasonally adjusted gross domestic product (GDP) increased by 0.1 percent in the euro area and by 0.2 percent across the EU compared with the previous quarter. This represents a moderation from the fourth quarter of 2025, when GDP expanded by 0.2 percent in both areas. On an annual basis, growth also weakened. Euro area GDP rose by 0.8 percent year-on-year in the first quarter, down from 1.3 percent in the previous quarter, while EU growth slowed from 1.4 percent to 1.0 percent. Germany returned to modest growth, expanding by 0.3 percent quarter-on-quarter, although annual growth remained weak at 0.3 percent. France shrank by 0.1 percent, while Italy grew by 0.3 percent. Though technically considered “modest growth,” this points to an overall stagnation of the EU, which continues to struggle with persistent structural challenges and the prospect of higher energy prices due to fallout from the Iran war.
Europe Drifts Closer to Stagnation
The bloc's economic outlook for the coming months is no better.
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