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2025-07-30 16:03:07
Has Europe's locomotive stalled? Eurozone economic alarm bells are ringing again. ⑴ On July 30, Germany's Federal Statistical Office released data showing that Germany's unadjusted GDP contracted by 0.1% quarter-on-quarter in the second quarter of 2025. ⑵ This figure is consistent with the consensus market forecast of -0.1%, indicating that Germany's economic performance is in line with the expected weakness. ⑶ Year-on-year, unadjusted GDP growth in the second quarter was 0.0%, below the market expectation of +0.1%. ⑷ However, calendar-adjusted GDP grew by 0.4% year-on-year in the second quarter, slightly above the forecast of +0.2%. ⑸ The negative quarter-on-quarter growth indicates that the German economy contracted in the second quarter. ⑹ Although the calendar-adjusted year-on-year data is slightly positive, the unadjusted quarter-on-quarter contraction undoubtedly casts a shadow over the eurozone's economic outlook. ⑺ As the "locomotive" of the European economy, Germany's economic performance serves as a bellwether for the entire eurozone. ⑻ This contraction may further exacerbate market concerns about a recession in Europe. ⑼ Investors should pay close attention to subsequent data, especially the possible response measures of the European Central Bank. ⑽ The euro may face new downward pressure as a result.
