Euro zone economy enjoys its best year in a decade

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People walk along a crowed shopping street on the first day of the winter sales on January 7, 2015 in Barcelona, Spain

That more-than-healthy level of growth means that for the whole of 2017, the euro zone economy expanded by 2.5 percent, its best performance since 2007, when it grew 3 percent. The euro zone even grew faster than the U.S., which expanded by 2.3 percent.

“Economic growth has shifted to a substantially faster growth path over the course of 2017,” said Bert Colijn, senior eurozone economist at ING. “While detailed breakdowns have yet to be released, it seems that the eurozone economy continues to fire on all cylinders.”

In the decade since 2007, the eurozone has had to grapple with one crisis after another, starting with the financial crash of 2008 that prompted the deepest worldwide recession since World War II. That exposed the weak underbelly of the eurozone — the state of the public finances in a number of member economies.

Four countries — Greece, Ireland, Portugal and Cyprus — had to be bailed out by their partners in the eurozone and the International Monetary Fund, and in return they made deep budget cuts to get their public finances into shape, hitting their economies hard. The Greek economy, for example, shed around a quarter of its output, and saw unemployment and poverty levels ratchet higher.

It’s only recently that existential concerns surrounding the euro have eased. Greece, notably, is set to emerge from its bailout era this summer, eight years after it first faced potential bankruptcy.

With fears of a breakup of the euro zone largely evaporated, confidence across the bloc has risen. That’s evident in the fact that growth isn’t just reliant on the big economies of Germany and France. Stronger growth is being recorded in those countries that were at the forefront of the crisis and that’s helping to bring down unemployment, potentially reinforcing the recovery even more.