Euro area GDP growth slows as expected, employment flat

Economic activity in the single currency bloc slowed sharply at the end of 2021 as the appearance of the Omicron variant of Covid-19 hit consumption.

According to Eurostat, gross domestic product in the euro area expanded at a quarter-on-quarter pace of 0.3% over the three months to December, exactly as expected.

That followed jumps in growth of 2.2% and 2.3% in the preceding two quarters, while in annual terms GDP growth clocked in at 4.6%.

Household consumption slowed sharply, shrinking at a quarter-on-quarter clip of 0.6%, offset by a 0.5% rise in government expenditures and a 3.5% jump in gross fixed capital formation, otherwise known as investment.

Export growth meanwhile printed at up by 2.9% for the quarter, although imports grew even more quickly, climbing by 4.6%.

Nonetheless, Eurostat reported that in parallel employment growth was flat quarter-on-quarter, after having grown by 2.1% during the third quarter, although in year-on-year terms it picked up from 3.4% to 5.0%.