The eurozone economy saw modest growth in the second quarter of 2025, defying expectations despite the backdrop of heightened global trade tensions. According to figures released by Eurostat, the 20 countries using the single currency collectively posted a 0.1% increase in GDP between April and June compared to the previous quarter.

This slight expansion comes at a time when trade relations between the European Union and the United States have been strained. Since returning to the presidency in January, Donald Trump has reintroduced tariffs targeting European goods. The situation reached a critical point, but on July 27, Brussels and Washington reached a deal aimed at halting a full-scale trade confrontation.

EU leaders have expressed optimism that the agreement will provide businesses with some stability. However, the compromise includes a 15% tariff on a majority of EU exports to the US, which economists say could still negatively impact European output in the coming quarters.

Performance across individual eurozone economies was mixed. France surprised on the upside, recording 0.3% growth in the second quarter. Spain outpaced all others, achieving a 0.7% expansion during the same period. Meanwhile, Germany - the bloc’s largest economy - saw a slight contraction of 0.1%, as did Italy.

The overall result for the euro area came in above forecasts made by Bloomberg and FactSet, which had predicted flat growth at 0.0%. The performance in the second quarter follows a stronger 0.6% expansion in the first quarter of the year. However, some economists have noted that the earlier figures were skewed by extraordinary results in Ireland, and they caution against using them as a benchmark.

For the broader European Union, which includes seven countries outside the eurozone, the economy grew by 0.2% over the same three-month period. This follows a 0.5% increase in the first quarter, suggesting that while growth is slowing, the EU still managed to stay in positive territory despite the economic headwinds.