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The eurozone economy grew 0.1% in the second quarter of the year, coming in marginally better than the zero growth expected by economists.

However, it was still a slowdown compared with the 0.6% growth seen in the first three months of 2025, as businesses had raced to get ahead of US tariffs by making more products and increasing exports to the country.

Seasonally adjusted gross domestic product (GDP) also rose by 0.2% in the European Union in the second quarter of 2025, compared with the previous quarter. Year-on-year, growth eased a little, with the eurozone up 1.4% and the EU up 1.5%, both slightly below the pace previous pace.

Riccardo Marcelli Fabiani, senior economist at Oxford Economics, said: "Although the slowdown is to a large extent a by-product of a misleadingly healthy Q1 number, broad-based weakness across national data indicates that the economy lacks momentum, with only a handful of countries blowing into its sails."

The latest reading was better than expected due to Spain leading the way with a 0.7% expansion. This was a result of solid consumer spending, a rebound in business investment and rising exports.

"Spain is in another league, showing stubbornly robust dynamism. The moderate Q2 decline in Irish GDP suggests that there is ample room for further correction," Fabiani added.

There was also faster-than-expected growth in France, the second-largest economy in the EU. France significantly outperformed expectations, growing 0.3% during the period, according to the preliminary data.

This was a surprise acceleration in growth from the 0.1% revised reading for first-quarter growth — and higher than the 0.1% expected by economists polled by Reuters.

Portugal and Estonia also delivered solid results, expanding 0.6% and 0.5%, respectively.

Meanwhile, the German economy contacted 0.1% in the second quarter of the year as companies adjusted to the impact of US president Donald Trump’s tariffs. This marked the country’s first contraction since mid-2024 due to weaker investment in machinery and construction.

Economists had expected the decline in output from the EU’s largest economy and biggest exporter, with the country’s federal statistics agency revising down growth in the first quarter to 0.3%, rather than the preliminary reading of 0.4%.

Italy’s GDP likewise shrunk 0.1% in the second quarter, reversing the 0.3% gain recorded in the first quarter and defying market expectations of a 0.2% increase. It was the country’s first contraction since the second quarter of 2023.

Nicholas Farr, emerging Europe economist at Capital Economics, added that the economies of Hungary and Czechia “have held up reasonably well since the introduction of US tariffs in April”, according to data published on Wednesday.

Hungary’s economy grew 0.4%, an improvement from a 0.1% contraction in the previous quarter. However, the Czech economy saw growth slow to 0.2% from 0.8% in the first quarter.