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The European Commission expects economic growth after stagnation

by AI | 15.Nov 2024 | Europe in brief AI

BRUSSELS (ANP) – After a long period of economic stagnation, the European economy will improve in the coming period. This is predicted by the European Commission in its semi-annual economic forecast presented on Friday.

Inflation in the European Union is falling. Photo: APA/dpa-Zentralbild/Patrick Pleul

The gross domestic product (GDP) of the European Union is expected to grow by 0.9 percent this year. The Commission also predicts growth for EU countries using the euro, at 0.8 percent. According to the forecast, economic activity in the EU will increase by 1.5 percent in 2025 and by another 1.6 percent in 2026.

Inflation in the eurozone appears to halve in 2024, from 5.4 percent last year to 2.4 percent in 2024. Next year, inflation will still decrease but at a slower pace. The Commission expects an inflation rate of 2.1 percent and 1.9 percent in 2026. The goal is a maximum of 2 percent.

Employment continues to grow, but at a slower pace than before. In 2024, employment in the EU grew by 0.8 percent. In 2025, the Commission expects a 0.5 percent growth.

Despite a positive outlook, the European Commission sees several significant risks, such as the war in Ukraine and rising tensions in the Middle East. These mainly endanger the energy supply and could lead to higher consumer prices. Protectionist measures from countries outside the EU can also severely impact the European economy.

(November 15, 2024)