Euro Area Government Debt

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The euro area government deficit narrowed to -2.9% of GDP in Q1 2025, down from -3.2% in Q4 2024, as a slight decline in revenue was offset by a larger decline in expenditures.
- Euro area total revenue was 46.6% of GDP (down -0.1 ppts), while expenditure declined to 49.5% of GDP (down -0.4 ppts).
- Gross government debt in the euro area rose to 88.0% of GDP in Q1 2025 from 87.4% in Q4 2024 also up 0.2 ppts from a year ago.
- Debt composition remained stable, with 84.2% of euro area government debt in securities, 13.3% in loans, and 2.6% in currency and deposits.
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The euro area government deficit fell to -3.2% of GDP in Q4 2024, down from -2.8% of GDP in Q3 2024.
- Total revenue fell -0.4 ppts to 46.6% of GDP, while total expenditure ticked up 0.1 ppts to 49.9% of GDP.
- Of the major European economies, Germany’s and France’s deficits remained unchanged at -2.5% of GDP and -6.1% of GDP respectively. Spain’s deficit improved 0.1 ppts to -3.3% of GDP.
- Total government debt fell -0.7 ppts to 87.4% in Q4 2024, up 0.1 ppts from a year ago.
- In 2024, the deficit was -3.1% of annual GDP, the lowest so far in the post-pandemic era. Annual spending was 49.6% of GDP (+0.1 ppts), and annual revenue was 46.5% of GDP (+0.5 ppts).
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The euro area government deficit fell to 2.6% of GDP in Q3 2024 from 3.1% in Q2 2024 as revenues increased and total expenditures remained unchanged. This is the smallest deficit reading since Q2 2022 and the joint 2nd lowest in the post pandemic period.

In the last year, total revenue has grown from 46.0% of GDP in Q3 2023 to 47.0% of GDP in Q3 2024 while total expenditures have remained unchanged at 49.6% of GDP.

Total euro area government debt sits at 88.2% of GDP as of Q3 2024, unchanged from Q2 2024 and down -0.2 ppts from a year ago. Greece (158.2%), Italy (136.3%), and France (113.8%) remain as the countries with the most debt in the region with France having one of the largest quarterly increases in debt (+1.4 ppts) in Q3 vs Q2.

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