According to European Commission’s Winter 2024 Economic Forecast, Eurozone’s GDP growth for 2024 was revised notably downwards to 0.8% from Autumn’s estimate of 1.2%, reflecting a more subdued outlook than previously anticipated. For 2025, GDP growth forecast as slightly downgraded to 1.5% from 1.6%.
Inflation is expected to decelerate more rapidly in 2024, with HICP forecasted at 2.7%, down from prior 3.2%. Meanwhile, inflation forecast for 2025 remains unchanged at 2.2%.
Vice-President Valdis Dombrovskis highlighted that despite the challenges faced in 2023, “rebound should speed up gradually this year and into 2025”. Inflation will continue its “broad-based decline” and bolstered consumer demand through real wage growth and a robust labour market.
Commissioner for Economy Paolo Gentiloni acknowledged the “more modest” economic rebound this year. But growth is set to “firm” and inflation to decline to close to ECB’s 2% target in 2025.
Full EU Winter Economic Forecast here.
