Euro area, gross domestic product grows by 0.4% while prices rise back to 2.9%

The figure shaping the European economic summer arrived on August 14: in the second quarter of 2026 seasonally adjusted gross domestic product grew by 0.4% in the euro area and by 0.5% across the European Union compared with the previous three months, while employment moved by just one-tenth of a point (Eurostat). The gap between the two figures is the most informative part: the quarter’s expansion has not yet translated into demand for labor, and the ratio between the two indicates growth achieved more through productivity or sectoral composition than through new jobs.

On the robustness of the figure, the release is explicit about its own limits. The estimate relies on national information covering 99% of euro area and EU output, a percentage that falls to 95% and 92% respectively when it comes to employment. A first version had been released on July 30 with data from only 19 member states, and the current figures may change with the routine revisions scheduled for September 7 and October 20. Anyone reading a tenth of a point as a turning point is reading a figure the institute itself still considers provisional.

The industrial supply picture remains the constraint. In June, industrial production was unchanged in the euro area and rose by 0.2% in the European Union compared with May (Eurostat). In Italy, the Istat release published in August presents indices based on 2021, adjusted for calendar effects and seasonally adjusted sector by sector, with a table dedicated to the revisions made to May’s data: here too the June values are declared provisional, and the full series remain in the institute’s public database. Production that is not growing alongside a gross domestic product that is growing is information about the relative weight of services, not a contradiction.

The third element is the one shaping monetary policy decisions. According to the flash estimate released on July 31, euro area annual inflation was expected at 2.9% in July, up from 2.8% in June, with the energy component at 10.0% (Eurostat). The final figure for July was scheduled for August 19. An acceleration driven by energy has a different nature from one driven by services or wages, and the distinction matters because central banks have, by definition, little leverage over the former.

Outside Europe, the same day of trading showed that energy prices are not driving expectations. On August 17 Brent was trading around $89 a barrel and WTI at $82.5, with changes of less than half a percentage point despite tensions over Hormuz: in the absence of actual supply disruptions, the geopolitical premium did not materialize (Il Sole 24 Ore).

What moved quotations instead was technology. The Federal Reserve Bank of New York’s manufacturing index rose to 20.6 in August from 15.6 in July, well above expectations of a flat 11, marking a second consecutive expansion and the fastest pace since late 2021; in the same session semiconductor makers gained ground after Bloomberg reported that Anthropic’s quarterly revenue exceeded $11.5 billion. On the Asian front, Alibaba closed up 0.9% on reports concerning the sale of Lingxi Games to the Trustar Capital fund for more than $2 billion, while Intel gained 0.4% after its chief executive purchased more than 105,000 shares at $95 (Milano Finanza).

The next checkpoints have fixed dates: September 7 and October 20 for revisions to the quarterly accounts, and November 13 for the next release of the series.