Winter 2018 Interim Economic Forecast: A solid and lasting expansion
Growth rates for the euro area and the EU beat expectations last year as the transition from economic recovery to expansion continues. The euro area and EU economies are both estimated to have grown by 2.4% in 2017, the fastest pace in a decade.
This robust performance is set to continue in 2018 and 2019 with growth of 2.3% and 2.0% respectively in both the euro area and EU.
Growth is likely to remain solid
The 2.4% GDP growth now estimated for 2017 is above November’s Autumn Economic Forecast projections of 2.2% for the euro area and 2.3% for the EU. The growth forecasts for 2018 and 2019 have also been raised since November for both the euro area and EU economies: from 2.1% to 2.3% for this year and from 1.9% to 2.0% for 2019. This is a result of both stronger cyclical momentum in Europe, where labour markets continue to improve and economic sentiment is particularly high, and a stronger than expected pick-up in global economic activity and trade.
Strong demand, high capacity utilisation and supportive financing conditions are set to favour investment over the forecast horizon.