The eurozone economy expanded by 0.4% in the second quarter of 2026, accelerating from flat growth in the previous quarter and beating market expectations of a 0.2% increase, according to preliminary estimates. It marked the bloc's strongest quarterly expansion since the first quarter of 2025, as robust AI-related investment, solid government spending, and one-off factors helped offset the impact of the conflict in Iran and higher energy costs. Among the largest euro area economies, Spain once again led growth, with GDP rising 0.7%, up from 0.6% in the first quarter and above forecasts. The Netherlands expanded by 0.4%, twice the expected pace, while France returned to growth with a 0.2% increase after a 0.1% contraction. Germany and Italy also grew by 0.2%, easing slightly from the previous quarter but exceeding market expectations.The eurozone economy expanded by 0.4% in the second quarter of 2026, accelerating from flat growth in the previous quarter and beating market expectations of a 0.2% increase, according to preliminary estimates. It marked the bloc's strongest quarterly expansion since the first quarter of 2025, as robust AI-related investment, solid government spending, and one-off factors helped offset the impact of the conflict in Iran and higher energy costs. Among the largest euro area economies, Spain once again led growth, with GDP rising 0.7%, up from 0.6% in the first quarter and above forecasts. The Netherlands expanded by 0.4%, twice the expected pace, while France returned to growth with a 0.2% increase after a 0.1% contraction. Germany and Italy also grew by 0.2%, easing slightly from the previous quarter but exceeding market expectations.