Eurozone Q4 GDP up 0.4%, in line with expectations

Eurozone gross domestic product growth for the fourth quarter was confirmed at 0.4% thanks to a rebound in investment spending, according to data released by Eurostat on Tuesday.

Seasonally-adjusted GDP was up 0.4% in the bloc compared to the previous quarter and 1.7% from the fourth quarter of the previous year. Both figures were in line with estimates and consensus.

In the EU-28 group of nations, GDP was up 0.5% compared with the previous quarter and 1.9% from the fourth quarter of 2016.

Over the course of 2016, GDP rose by 1.7% in the euro bloc and 1.9% in the EU-28.

In the fourth quarter of 2016, household final consumption expenditure rose by 0.4% in the euro area and by 0.5% in the EU-28 following increases of 0.3% and 0.5%, respectively, in the previous quarter.

Gross fixed capital formation increased by 0.6% in the euro area and by 0.4% in the EU-28, while exports rose by 1.5% in the euro area and by 1.9% in the EU-28. Imports were up 2.0% and 1.6%, respectively.

Pantheon Macroeconomics said: "Survey data suggest that GDP growth will accelerate in Q1, but the hard data so far suggest this forecast is too upbeat. We worry about the hit to consumers’ spending from weak real wage growth, but investment should continue to perform well."