The growth rate for the fourth quarter was revised down from 1.8 percent.

In the EU-28 group of nations, GDP rose by 0.5% on the quarter and 1.8% on the year.

Economic growth in the 19-country eurozone was steady in the second half of 2016, despite a series of shocks to confidence, including the U.K.'s vote to depart the European Union and terrorist attacks in Germany, France and Belgium.

-EURUSD was little changed in Europe Tuesday despite news that the Euro-Zone economy grew by 0.4% month/month in the fourth quarter of 2016 rather than the 0.5% originally estimated. The EU on Monday raised its full-year growth forecast for the region to 1.6%.

"The economic situation in Germany in 2016 thus was characterised by solid and steady growth", Destatis commented.

The economy in Spain grew by 3% in 2016, while Germany grew by 1.8%, Eurostat said.

Germany, the bloc's largest economy, mirrored the eurozone as a whole with 0.4 percent expansion, lower than expected but a rebound from a near-stall (0.1 percent) in the previous quarter.

Economic activity firmed in France, but eased a little in Italy.

The so-called statistical overhang from the fourth quarter was confirmed at 0.5 percent.

The data also put Euro-zone GDP growth slightly below the equivalent USA rate for the fourth quarter which will reinforce expectations of divergence and an out-performance by the United States economy, especially if there is a push by the Administration to cut taxes.

Nonetheless, the latest data suggest that the outlook for Euro-Zone growth in 2017 is hardly positive, with rising energy prices an additional negative factor despite robust domestic demand in Germany. It is a particular concern in Germany, where people are sitting on around EUR2 trillion ($2.1 trillion) of deposits which offer little or no interest.