The euro-area economy’s failure to expand in the fourth quarter was down to a plunge in trade.

Data released Friday by Eurostat confirmed that the 20-nation bloc stagnated between October and December. During that period, net exports sank by 0.3%, adding to a 0.1% drop in inventories, it said.

At the same time, there were gains in government spending and fixed investment.

The region’s outlook for this year isn’t much better. The European Central Bank on Thursday cut its 2024 growth forecast to just 0.6%, saying gross domestic product will only rise 0.1% this quarter.

“The economy remains weak,” President Christine Lagarde told reporters. “However, surveys point to a gradual recovery over the course of this year. As inflation falls and wages continue to grow, real incomes will rebound, supporting growth.”

--With assistance from Joel Rinneby and Barbara Sladkowska.