Germany slows European economic growth

The European economy is facing sluggish growth with chief economist Jeppe Juul Borre from Arbejdernes Landsbank commenting on the recent Eurostat figures showing just a 0.1 percent rise in GDP for the Eurozone in the fourth quarter compared to the previous one. Germany reported a GDP decline of 0.2 percent, while France experienced a 0.1 percent contraction in the same period. This muted growth trend has been continuing since the end of 2022 due to high inflation and economic and political uncertainties. Growth has been marginally better in 2024 compared to 2023 but remains historically low. Danish economists predict possible cuts in interest rates by the European Central Bank (ECB), which has already made five rate cuts with three to four more anticipated in 2025. Central banks closely monitor economic growth when deciding on interest rate adjustments.