Eurozone GDP grows 0.3% in fourth quarter, against expectations of 0.2% increase

The Eurozone gross domestic product (GDP) in the fourth quarter grew 0.3% from the previous three months, above consensus expectations of a 0.2% increase.

Annual growth in the fourth quarter edged up to 0.9% year-on-year, from 0.8% in the previous three months.

“The bulk of fourth quarter GDP growth is likely due to domestic demand, with private consumption growing considerably again, faster than the third quarter's 0.5% quarter-on-quarter expansion,” said Evelyn Herrmann, European economist at BNP Paribas.

The better-than-expected growth will come as welcome news for the European Central Bank’s president Mario Draghi, who faced an uphill task in trying to steer the Eurozone out of deflation.

“Mario Draghi has bought himself a bit of time, as year-on-year figures show small signs of Eurozone growth following the significant bond buying programme he announced recently,” Dennis de Jong, managing director at UFX.com.

“However, with 18 other EU countries having a larger debt as a proportion of GDP than the Greeks, plus the very real danger of deflation, it’s clear the next few months are make or break for the single currency.

“Hopes rest largely on the success of the stimulus programme, but the situation is likely to remain precarious for the foreseeable future.”