“The economy of the Eurozone in 2025 will grow weaker than previously forecast – by 1.3%.”, — write: www.epravda.com.ua
The economy of the Eurozone in 2025 will grow weaker than previously forecast – by 1.3%.
About this informs European Commission.
The eurozone economy is expected to grow by just 0.8% in 2024 (the forecast will remain unchanged), while in 2025 it will grow by 1.3% (expected to grow by 1.4%) and in 2026 by 1.6%.
The EU expects headline inflation in the euro area to more than halve in 2024, from 5.4% in 2023 to 2.4%, and then begin to decline gradually to 2.1% in 2025 and 1.9% in 2026.
The EU budget deficit is projected to shrink by around 0.4ppt to 3.1% of GDP in 2024 thanks to windfalls and fiscal consolidation efforts.
In 2025, the deficit is projected to narrow slightly to 3.0% as further fiscal restraint is offset by revenue shortfalls. In 2026, positive economic dynamics should further reduce the deficit to 2.9%.
In the euro area, the deficit is projected to gradually decline from 3.0% of GDP in 2024 to 2.8% in 2026.
According to the EC’s forecast, the EU’s economic prospects remain extremely uncertain, and risks are largely shifted to the downside. In particular, Russia’s war against Ukraine and the escalation of the conflict in the Middle East fuel geopolitical risks and the vulnerability of European energy security that remains.
Further strengthening of protectionist measures on the part of trading partners may put pressure on world trade, which will have a negative impact on the EU economy, the European Commission expects.
On the domestic front, policy uncertainty and structural problems in the manufacturing sector could cause further losses in competitiveness and put pressure on growth and the labor market.
We will remind:
If US President Donald Trump is elected will fulfill its promise to hit European imports with tariffs, Hungary will feel the consequences “in geometric progression” through its trade ties with Germany.
Europe continues buy billions of euros worth of Russian gas and even increase supplies, which is a sign that the continent still cannot live without the Russian energy carrier.