The Eurozone economy grew 0.4% quarter-on-quarter in the second quarter of 2025, according to a Eurostat flash estimate released on July 30, matching market forecasts and accelerating from 0.3% in the first quarter. The data pointed to a steady but moderate recovery, with economists citing a strong labor market and easing inflation as support for household consumption. Services, including tourism and business services, were seen as key contributors, while manufacturing remained subdued amid weak external demand and broader trade uncertainty. Financial markets showed little immediate reaction, with the euro broadly stable and government bond yields little changed. For the European Central Bank, the growth pace supports a gradual approach to monetary policy as inflation nears the 2% target, though policymakers remain cautious about wage growth and services inflation. The figures suggest a stable backdrop for businesses and consumers, even as growth remains below the pre-pandemic trend and risks including geopolitical tensions and potential energy price spikes continue to cloud the outlook.