Interview with Isabel Schnabel, Member of the Executive Board of the ECB, conducted by Francesco Canepa and Balazs Koranyi on 28 August 2025

2 September 2025

Could you give us your assessment of economic developments since your June projections? How is the euro area doing compared to your baseline?

Incoming data have confirmed the resilience of the euro area economy. Over the past one and a half years, the euro area economy has grown by around 0.3% per quarter, which is broadly in line with potential growth. This is quite remarkable given all the economic and trade policy uncertainty that we’ve seen. It underlines that the euro area economy has been more resilient than expected.

This also suggests that recent strong GDP growth is not mere frontloading, but points towards a more fundamental improvement in underlying growth dynamics. In fact, the recovery reflects robust growth in domestic demand, supported by easier financing conditions, and this has counteracted the recent decline…