Eurozone Economic Forecast

Eurozone Economic Outlook

March 27, 2018

Detailed data confirmed that the Eurozone economy continued to grow robustly in the fourth quarter of 2017, capping off the best year of growth in over a decade. The solid reading was driven by a rebound in fixed investment, supported by optimistic business sentiment, and buoyant export growth despite a strong euro. Recent data for Q1 has been strong, albeit pointing to a moderation from prior levels. Economic sentiment edged down in February, while the composite PMI fell in March. However, the unemployment rate remained at a multi-year low in January. Meanwhile, the relationship with the United States, a major trading partner, has come into focus in recent weeks, after U.S. President Trump announced tariffs on steel and aluminum. On 23 March, the U.S. government announced that exports from the EU would be temporarily exempted until 1 May, and discussions on the topic are ongoing. A breakout of a tit-for-tat tariff battle could dent confidence and economic activity on both sides of the Atlantic.

Eurozone Economic Growth

A buoyant domestic economy should fuel another year of solid growth in 2018, as last year’s growth drivers are largely in place. Tight labor markets, high sentiment and accommodative monetary policy should support activity, while a strong euro could dent export growth. Met the why particular analysts upgraded their forecasts for a sixth consecutive month this month and now see the Eurozone economy growing a robust 2.4% this year, up 0.1 percentage points from last month’s forecast. In 2019, GDP is forecast to grow 1.9%.

Eurozone Economy Data

20122013201420152016
Population (million)331331-  -  -  
Population (million)331331-  -  -  
GDP per capita (EUR)29,75629,979-  -  -  
GDP per capita (EUR)29,75629,979-  -  -  
GDP (EUR bn)9,8369,932-  -  -  
GDP (EUR bn)9,8369,932-  -  -  
Economic Growth (GDP, annual variation in %)-0.9-0.2-  -  -  
Economic Growth (GDP, annual variation in %)-0.9-0.2-  -  -  
Domestic Demand (annual variation in %)-2.4-0.6-  -  -  
Domestic Demand (annual variation in %)-2.4-0.6-  -  -  
Consumption (annual variation in %)-1.2-0.5-  -  -  
Consumption (annual variation in %)-1.2-0.5-  -  -  
Investment (annual variation in %)-3.3-2.5-  -  -  
Investment (annual variation in %)-3.3-2.5-  -  -  
Exports (G&S, annual variation in %)2.92.2-  -  -  
Imports (G&S, annual variation in %)-0.61.4-  -  -  
Imports (G&S, annual variation in %)-0.61.4-  -  -  
Industrial Production (annual variation in %)-2.3-0.7-  -  -  
Industrial Production (annual variation in %)-2.3-0.7-  -  -  
Retail Sales (annual variation in %)-1.4-0.6-  -  -  
Retail Sales (annual variation in %)-1.4-0.6-  -  -  
Unemployment Rate11.412.0-  -  -  
Unemployment Rate11.412.0-  -  -  
Fiscal Balance (% of GDP)-3.6-3.0-  -  -  
Fiscal Balance (% of GDP)-3.6-3.0-  -  -  
Public Debt (% of GDP)89.591.4-  -  -  
Public Debt (% of GDP)89.591.4-  -  -  
Money (annual variation in %)3.00.4-  -  -  
Money (annual variation in %)3.00.4-  -  -  
Inflation Rate (HICP, annual variation in %, eop)2.20.9-  -  -  
Inflation Rate (HICP, annual variation in %, eop)2.20.9-  -  -  
Inflation Rate (HICP, annual variation in %)2.51.4-  -  -  
Inflation Rate (HICP, annual variation in %)2.51.4-  -  -  
Inflation (PPI, annual variation in %)2.8-0.2-  -  -  
Inflation (PPI, annual variation in %)2.8-0.2-  -  -  
Policy Interest Rate (%)0.750.25-  -  -  
Policy Interest Rate (%)0.750.25-  -  -  
Stock Market (annual variation in %)14.419.1-  -  -  
Stock Market (annual variation in %)14.419.1-  -  -  
Exchange Rate (vs EUR)1.321.38-  -  -  
Exchange Rate (vs EUR)1.321.38-  -  -  
Exchange Rate (vs EUR, aop)1.291.33-  -  -  
Exchange Rate (vs EUR, aop)1.291.33-  -  -  
Current Account (% of GDP)1.42.2-  -  -  
Current Account (% of GDP)1.42.2-  -  -  
Current Account Balance (EUR bn)138219-  -  -  
Current Account Balance (EUR bn)138219-  -  -  
Trade Balance (EUR billion)125207-  -  -  
Trade Balance (EUR billion)125207-  -  -  

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Eurozone Facts

ValueChangeDate
Exchange Rate1.230.65 %Apr 20
Stock Market1,216-0.52 %Apr 20

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