The economy of the EU and the euro countries will only grow by 2.7 percent this year instead of the previously expected 4 percent, according to the spring forecast presented by the EU Commission on Monday. The forecast for inflation in the euro countries in 2022 has almost doubled to 6.1 percent.
The authority had already had to adjust its forecasts in its winter forecast in February due to high energy prices and the omicron wave, among other things. The war in Ukraine and the persistently high prices for energy and other raw materials continue to exert pressure, the commission said. There were also war-related disruptions in the supply chains.
For the coming year, the EU Commission is assuming 2.3 percent growth in the EU and the euro area. In her February forecast, she had predicted 2.8 percent for the EU and 2.7 percent for the euro countries in 2023.
In terms of inflation in the euro area, the forecast for the euro countries has almost doubled this year, from the previously forecast 3.5 to 6.1 percent on an annual average. This is mainly due to the high energy prices, it said.
In 2023, inflation is expected to drop to 2.7 – still above the 2 percent target of the European Central Bank (ECB). Before the war began, the commission had assumed an average of 1.7 percent in the coming year.
In the EU as a whole, the Commission is even assuming average inflation of 6.8 percent this year and 3.2 percent next year.