The ECB downgraded its forecast for eurozone GDP growth in 2024

The forecast for the current year is 0.7%, compared to 0.8% expected in September

The European Central Bank (ECB) has downgraded its forecast for eurozone GDP growth in 2024 to 0.7% from 0.8% expected in September. This is stated in the report of the institution.

Expectations of economic growth in the eurozone next year were revised to 1.1% from 1.3%, in 2026 – to 1.4% from 1.5%.

As noted, the ECB expects a slower economic recovery than in its September forecasts. Although growth accelerated in the third quarter of this year, data indicate a slowdown in the current quarter.

In 2017, GDP is expected to grow by 1.3%.

“The projected recovery is based mainly on the growth of real incomes, which should allow households to consume more and companies to increase investments. Over time, the gradual easing of restrictive monetary policy should contribute to the growth of domestic demand,” the regulator said.

On December 12, the ECB cut all three key interest rates for the fourth time in a year. The regulator predicts that headline inflation will average 2.4% in 2024, 2.1% in 2025, 1.9% in 2026 and 2.1% in 2027, when the EU’s expanded emissions trading system comes into effect.

As GMK Center reported earlier, inflation in the eurozone increased by 2.3% in November 2024 compared to the same month in 2023. Thus, the indicator accelerated the growth rate compared to October, when it was +2% y/y.