The eurozone economy expanded by 0.3% in the second quarter, according to the latest data, outperforming expectations and suggesting the bloc still has some momentum despite broader concerns about slowing demand. The result marks a modest but welcome improvement for policymakers watching for signs of a deeper slowdown.

The stronger-than-forecast reading comes as inflation continues to ease, giving the European Central Bank more room to consider another interest-rate cut as soon as July. Officials have not committed to a move, but the latest figures strengthen the case for supporting growth without reigniting price pressures.

For households and businesses across the currency union, the data may offer limited relief after a prolonged stretch of higher borrowing costs. Any decision by the ECB will need to balance fragile economic activity against its mandate to keep inflation under control.

Markets will now focus on upcoming inflation releases and ECB commentary for clearer signals on whether policymakers see enough progress to loosen policy further next month.