In its quarterly assessment published on Wednesday, the European Commission has cut its Eurozone economic growth forecasts for this year and next, saying the bloc could avoid a technical recession.
Additional comments
Growth forecasts for 2023 are reduced from 0.8% previously to 0.6%.
The growth forecast for 2024 is 1.2%, and 1.6% in 2025.
Eurozone growth in the fourth quarter will be 0.2% quarter-on-quarter after -0.1% in the third quarter, avoiding a technical recession.
The inflation forecast for 2023 is 5.6%, 3.2% in 2024 and 2.2% in 2025.
High inflation, interest rates and lower foreign demand affected growth more than expected.
The euro zone’s aggregate budget deficit is forecast to fall to -2.8% of GDP in 2024, from -3.2% in 2023, and decline to -2.7% in 2025.
Italy, France, Belgium, Slovakia and Malta are expected to have budget deficits well above the EU’s 3% limit in 2024 and 2025.
The euro zone’s aggregate public debt is projected to decline in 2024 to 89.7% of GDP from 90.4% in 2023, and to 89.5% in 2025.
Italian public debt, the second highest in the EU, is forecast to rise to 140.6% of GDP in 2024 and 140.9% in 2025, from 139.8% in 2023.
Source: Fx Street
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