In the latest economic projections released today, European Commission downgraded growth forecasts as “the external environment has become much less supportive and uncertainty is running high”. And, this is “particularly affecting the manufacturing sector, which is also experiencing structural shift”. European economy looks to be “heading towards a protracted period of more subdued growth and muted inflation.”
Eurozone GDP is forecast to grow by 1.1% in 2019 (down from summer forecast of 1.2%), 1.2% in 2020 (down from 1.4%) and 1.2% in 2021. For EU as a whole, GDP is expected to grow 1.4% in 2019, 2020 (down from 1.6%) and 2021. Eurozone HICP is forecast at 1.2% in 2019, rising to just 1.3% in 2021.
Valdis Dombrovskis, Vice-President said: “We could be facing troubled waters ahead: a period of high uncertainty related to trade conflicts, rising geopolitical tensions, persistent weakness in the manufacturing sector and Brexit.” Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs, said: “The challenging road ahead leaves no room for complacency. All policy levers will need to be used to strengthen Europe’s resilience and support growth.”
