EU Commission: Eurozone economy seen picking up in 2025 and 2026

Dhwani Mehta FXStreet

In its quarterly assessment published on Friday, the European Commission projects a bright Eurozone economic outlook for 2025 and 2026 but warned of overseas risks.

Additional takeaways

Sees Eurozone economic growth at 0.8% in 2024, 1.3% in 2025 and 1.6% in 2026.

Sees Eurozone inflation at 2.4% in 2024, 2.1% in 2025 and 1.9% in 2026.

Sees Eurozone budget deficit at 3.0% in 2024, 2.9% in 2025 and 2.8% in 2026.

Sees Eurozone public debt at 89.1% in 2024, 89.6% in 2025 and 90.0% in 2026.

Sees increased risks to the outlook from the war in Ukraine, conflict in the Middle East, and protectionism in trade.

German GDP will expand 0.7% in 2025 vs 1.0% growth in previous forecast.

German GDP growth expected to accelerate to 1.3% in 2026, but remain below Eurozone average of 1.6%.

German economy will contract 0.1% this year vs 0.1% growth in the Spring forecast.

Market reaction

EUR/USD holds the latest uptick near 1.0568, up 0.35% on the day, as of writing.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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