The European Central Bank is cutting its key interest rate, a step to boost an economy that’s struggling to grow as consumers burned by inflation warily eye price tags and businesses try to chart a course amid political turmoil in leading economies France and Germany.

Economists polled by Reuters had expected growth of 0.1% over the period, following a larger-than-expected 0.4% expansion in the third quarter.

The euro zone economy stagnated last quarter as worried consumers zipped up their purses, adding to fears that a long-predicted recovery could be further delayed, Eurostat data showed on Thursday.

The eurozone economy failed to grow in the fourth quarter of 2024, marking a sharp slowdown from the previous quarter and missing expectations for modest expansion. Flash figures released by Eurostat on Thursday showed that gross domestic product (GDP) was unchanged from the previous quarter,

The euro zone economy experienced stagnation last quarter as reluctant consumers curbed spending, casting doubt on recovery prospects. Factors like Germany's contraction and high energy costs contribute to the slowdown.

The euro area economic growth ground to a halt in the fourth quarter as output shrunk in Germany and France and remained flat in

Germany’s public debt currently stands at 62%, according to Eurostat data, thus twenty points below the EU average and much lower than in other G7 economies – all of which have a government debt level of above 100% of GDP.

The stuttering economic performance, coupled with an outlook overshadowed by the risks of trade tension with the U.S. and China, mean that the European Central Bank is almost certain to cut its key interest rates again Thursday, bringing its key deposit rate down to 2.75 percent.

The European Central Bank (ECB) cut its benchmark interest rate again by a quarter-point to 2.75% on Thursday as inflation nears 2% and growth remains weak.

The euro zone unexpectedly stagnated at the end of last year as government collapses in its top two economies bruised confidence among businesses and consumers.Most Read from BloombergManhattan’s Morn