The eurozone and the European Union saw a significant increase in their deficits in the third quarter of 2022, according to official data released Monday, with the primary causes attributed to the ongoing impact of the COVID-19 pandemic and rising energy costs.

The eurozone's seasonally adjusted general government deficit to GDP ratio stood at 3.3 percent in the third quarter, up from 2 percent in the second quarter, according to Eurostat, the EU's statistical office.

Meanwhile, the EU's deficit to GDP ratio rose to 3.2 percent in the third quarter, from 1.8 percent in the second quarter, Eurostat data showed.

The main reason for the increase in the fiscal deficit to GDP ratio was the expansion of government expenditure, noted Eurostat.

In the third quarter of 2022, total government revenue in the eurozone decreased 0.3 percentage points to 47.2 percent of GDP, compared with 47.5 percent in the previous quarter.

In contrast, total government expenditure in the eurozone stood at 50.5 percent of GDP, significantly increasing from 49.5 percent in the second quarter.

This trend was also observed in the EU, where total government revenue accounted for 46.4 percent of GDP in the third quarter, down from 46.8 percent in the second quarter.

However, total government expenditure in the EU experienced a sharp rise to 49.6 percent of GDP, up from 48.6 percent in the previous quarter.

Government finances continued to be influenced by policy responses to the COVID-19 pandemic, although to a lesser degree than in previous quarters.

Meanwhile, measures to alleviate the impact of high energy prices began to have a more pronounced impact on government balance sheets in the third quarter of 2022, with most EU member states continuing to run a government deficit, according to Eurostat.

(Cover via CFP)