FILE PHOTO: Workers assemble campers at Knaus-Tabbert AG factory in Jandelsbrunn near Passau, Germany, March 16, 2021. Picture taken March 16, 2021. REUTERS/Andreas Gebert/File Photo
BRUSSELS, Belgium — The eurozone economy unexpectedly expanded in the second quarter of 2025, official data showed Wednesday, despite international trade tensions clouding the global outlook.
The EU’s official data agency said the 20-country single currency area recorded growth of 0.1 percent over the same period last year — slightly better than the flat performance forecast by analysts.
The eurozone economy showed “resilience despite US trade volatility,” ING Bank’s Bert Colijn said.
Since US President Donald Trump returned to the White House in January he has hit the EU with a series of painful tariffs, but the bloc struck a deal on Sunday to avert an escalating trade war.
READ: EU, US strike ‘biggest-ever’ trade deal
EU officials hope the agreement will bring certainty for companies and stave off further economic pain, though analysts warn that Europe will still take a hit to its output from the deal, which foresees a 15-percent US tariff on most exports.
Eurostat data on Wednesday showed that Europe’s second-largest economy, France, beat expectations to grow by 0.3 percent in the second quarter, but it was Spain that was the star performer, recording growth of 0.7 percent between April and June.
Portugal also recorded 0.6 percent growth in the same quarter.
Europe’s economic powerhouse, Germany, unexpectedly shrank by 0.1 percent from the previous quarter. Italy’s economy also contracted by 0.1 percent in the period.
The eurozone growth of 0.1 percent came after the single currency area’s economy grew by 0.6 percent in the first quarter.
But economists warned against reading too much into the first-quarter data, saying it was due to an extreme change in Ireland’s figures.
The 27-country EU economy expanded by 0.2 percent over the April-June period from the previous quarter, after registering 0.5 percent growth in the first three months of 2025.
READ: Eurozone economy grows more than expected in Q1 despite US tariff turmoil
Weak growth expected
The year has been full of uncertainty for Europe. Trump threatened 30-percent levies on most European goods if Brussels and Washington did not clinch a deal by August 1.
Sunday’s agreement lacks details — with much still being negotiated — but the two sides confirmed a majority of EU products would face the 15-percent tariff rate, including pharmaceuticals and semiconductors.
Economists warned that the deal would impact the eurozone economy.
“With the 15 percent US universal tariff likely to subtract around 0.2 percent from the region’s GDP, growth is likely to remain weak in the rest of this year,” said Franziska Palmas, senior Europe economist at Capital Economics.
“Looking ahead, expect swings in trade to continue to influence the economy,” said ING’s Colijn, who nonetheless sounded an optimistic note for the future.
“For the short term, don’t expect miracles, but at the same time, there are new signs of life starting to emerge for the eurozone economy,” he said.
READ: EU car industry sees relief – and pain – in US trade deal
In the first half of the year, European companies rushed to ship more goods to avoid Trump’s higher tariffs.
France’s Economy Minister Eric Lombard said the figures for France showed that the country’s companies also proved resilient to US tariff hikes.
France is now pushing for zero tariffs on alcohol including champagne and wines as well as spirits, with talks still ongoing on the issue.
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European officials say the deal included an agreement on mutual tariff exemptions for certain goods — but which ones exactly remained to be nailed down.