Artificial intelligence investment and reduced exposure to fossil fuels have helped the eurozone withstand this year’s energy-price shock, European Central Bank economists said in an assessment published on Wednesday, October 21.
The ECB blog said output, excluding Ireland’s volatile figures, was 0.6% higher in the second quarter of 2026 than at the end of 2025. Quarterly growth had remained near 0.3% over the previous four quarters.
Energy efficiency and a shift towards services have reduced the region’s dependence on oil. Larger shares of renewable and nuclear electricity have also limited the transmission of higher gas prices to wholesale electricity prices in several countries.
Demand for equipment linked to AI investment has supported exports, while domestic technology spending and continued employment growth have helped sustain economic activity, according to the economists.
Reuters reported that the fiscal boost amounted to 0.5% of gross domestic product, twice what had been expected at the end of last year. Increased German spending on defence and infrastructure accounted for much of that support.
The news agency said the findings come as ECB policymakers consider further rate increases to contain energy-driven inflation, with a third rise this year expected in December. That expectation is not an announced policy decision.
The ECB economists cautioned that global demand, public spending and AI investment could weaken. They urged more investment in electricity networks and closer integration of European power markets to reduce vulnerability to future shocks.
Sources: European Central Bank; Reuters via Euronext.
