Eurozone's economy showed 0.4% growth in Q1 2025, exceeding the previous quarter's 0.2%. However, Trump's new tariffs on EU goods, including a 20% rate on various imports, have significantly dampened economic optimism. The EU's economic outlook has been downgraded due to its export dependence on the US. Despite positive indicators like low unemployment and falling inflation, the tariff uncertainty has negatively impacted business and consumer sentiment, potentially leading to subdued economic activity in the coming months. Germany, the eurozone's largest economy, has lowered its growth forecast to zero for the year.

Prepared by Christopher Adams and reviewed by editorial team.