The eurozone economy expanded 0.4% in the third quarter from the previous quarter, according to official data, exceeding the 0.2% growth forecast by economists surveyed by Bloomberg. Growth slowed from 0.6% in the second quarter, while Ireland’s 5.5% expansion lifted the regional result; excluding Ireland, eurozone growth was 0.2%. The stronger-than-expected performance came alongside inflation well above the European Central Bank’s 2% target, driven mainly by energy, food and transport costs. Inflation reached a three-year high of 3.8% in September. Economists warned that rising prices and uneven growth could create stagflationary pressures, particularly as higher energy costs challenge the economy over winter. Germany grew 0.2%, Spain expanded 0.6%, Italy stagnated and France contracted 0.1%, marking no growth for France in 2026. Analysts also pointed to stronger defence and infrastructure spending and the technology boom as support for European industry.