Photo: EuronewsPhoto: EuronewsEuropean Union
Euro-zone GDP grows 0.4% in third quarter as ECB weighs rate hike
Steady growth despite the Iran war gives the European Central Bank room to raise interest rates to curb inflation, affecting borrowing costs for businesses and governments.
What happened
Gross domestic product across the 21-member euro area rose 0.4% in the third quarter, Eurostat said on Friday. Bloomberg The growth figure matched an initial estimate from October. Bloomberg Analysts had expected growth of only half that pace when the October estimate was published. Bloomberg The European Central Bank kept its three key interest rates unchanged at its meeting on 29 October 2026. European Central Bank Energy prices have continued to rise, posing upside risks to the inflation outlook and downside risks to growth. European Central Bank
Around it
The euro-area economy has shown resilience to headwinds such as the Iran war, which gives the central bank leeway to raise interest rates further to stem inflation. Bloomberg The central bank said underlying inflation has remained broadly stable so far and wages do not show a material response at this stage. European Central Bank Financing conditions have tightened since the central bank's meeting on 10 September 2026, which is likely to weigh on inflation and growth. European Central Bank
What comes next
The central bank has committed to a data-dependent, meeting-by-meeting approach to determining the appropriate monetary policy stance. European Central Bank
Sources
More from the European Union
- Photo: Euronews
Photo: Politico Europe
Photo: Politico Europe