The euro area economy showed a modest improvement in the third quarter of 2025, with seasonally adjusted GDP rising 0.2 percent compared with the previous quarter. This marks a slight acceleration from the 0.1 percent expansion recorded in the second quarter, suggesting that growth momentum is slowly building despite persistent economic headwinds.

On an annual basis, GDP increased by 1.3 percent, a small easing from the 1.5 percent recorded previously. This indicates that while year-over-year growth remains positive, the pace of expansion is gradually cooling. The figures point to an economy navigating a challenging environment of weak external demand and cautious consumer spending, yet still avoiding stagnation. Among the top four nations within the region, Germany (0.0 percent after minus 0.2 percent) and Italy (0.0 percent after minus 0.1 percent) showed no growth in the third quarter, while France (0.5 percent after 0.3 percent) grew.

However, the rate of increase in Spain (0.6 percent after 0.8 percent) decelerated.
In essence, the data highlight resilience, but the slight slowdown in annual growth reinforces the need for policy stability and supportive investment conditions across the euro area. This latest update takes the RPI to 48 and the RPI-P to 53, meaning that economic activities are well ahead of the expectations within the euro area.

The consensus sees GDP up 0.1 percent in Q3 from Q2 and up 1.2 percent on year in Q3.

Gross domestic product (GDP) is the broadest measure of aggregate economic activity and encompasses every sector of the economy. There are two preliminary estimates which are based on only partial data. The first is the preliminary flash, introduced in April 2016 and limited to just quarterly and annual growth statistics for the region as a whole. This is issued close to the end of the month immediately after the reference period. The second flash report, released about two weeks later, expands on the first to include growth figures for most member states but still provides no information on the GDP expenditure components.

GDP is the all-inclusive measure of economic activity. Investors need to closely track the economy because it usually dictates how investments will perform. Stock market Investors like to see healthy economic growth because robust business activity translates to higher corporate profits. The GDP report contains information which not only paints an image of the overall economy, but tells investors about important trends within the big picture. These data, which follow the international classification system (SNA93), are readily comparable to other industrialized countries. GDP components such as consumer spending, business and residential investment illuminate the economy's undercurrents, which can translate to investment opportunities and guidance in managing a portfolio.

Each financial market reacts differently to GDP data because of their focus. For example, equity market participants cheer healthy economic growth because it improves the corporate profit outlook while weak growth generally means anemic earnings. Equities generally drop on disappointing growth and climb on good growth prospects.

Bond or fixed income markets are contrarians. They prefer weak growth so that there is less of a chance of higher central bank interest rates and inflation. When GDP growth is poor or negative it indicates anaemic or negative economic activity. Bond prices will rise and interest rates will fall. When growth is positive and good, interest rates will be higher and bond prices lower. Currency traders prefer healthy growth and higher interest rates. Both lead to increased demand for a local currency. However, inflationary pressures put pressure on a currency regardless of growth.