BRUSSELS (Reuters) – The European Commission lowered its forecast on Wednesday for the euro zone economy next year, saying that uncertainty over U.S. trade policy posed a major risk to the bloc.
In its quarterly economic forecasts, the European Union’s executive arm also lowered its estimate for inflation in the bloc, predicting that it would be further off the European Central Bank’s target of close to but less than 2%.
Commission - Prediction - Growth - Euro - Zone
The commission confirmed its prediction that economic growth in the euro zone would slow this year to 1.2% from 1.9% in 2018. It also lowered its estimate for next year’s growth, which is now seen at 1.4% instead of the 1.5% forecast in May.
Risks for the bloc have increased, the commission said, and mostly come from “the elevated uncertainty” around U.S. trade policy, as Washington keeps threatening punitive tariffs on a broad range of EU products.
Outlook - Revision - Inflation - Expectations - Commission
The weaker economic outlook contributed to a downward revision of inflation expectations, the commission said, cutting its estimate to 1.3% for this year and next from the 1.4% it previously...
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