In its quarterly publication released on Thursday, the European Commission cut its forecasts for the euro area economic growth for 2022 while upgrading its estimates for inflation, in the face of the Russia-Ukraine war.
Key takeaways
EU Commission expects GDP growth of 2.6% in euro area in 2022, down from 2.7% in previous outlook.
Expects GDP growth of 1.4% in euro area in 2023, down from 2.3% in previous outlook.
Expects euro area inflation of 7.6% in 2022, up from 6.1% in previous outlook.
Expects euro area inflation of 4.0% in 2023, up from 2.7% in previous outlook.
Expects German GDP growth of 1.4% in 2022, down from 1.6% in previous outlook.
Expects German GDP growth of 1.3% in 2023, down from 2.4% in previous outlook.
Expects German inflation of 7.9% in 2022, up from 6.5% in previous outlook.
Expects German inflation of 4.8% in 2023, up from 3.1% in previous outlook.
Expects French GDP growth of 2.4% in 2022, down from 3.1% in previous outlook.
Expects French GDP growth of 1.4% in 2023, down from 1.8% in previous outlook.
Expects French inflation of 5.9% in 2022, up from 4.9% in previous outlook.
Expects French inflation of 4.1% in 2023, up from 3.1% in previous outlook.
Expects GDP growth of 2.7% in EU in 2022, unchanged from previous outlook.
Expects GDP growth of 1.5% in EU in 2023, down from 2.3% in previous outlook.
Expects Italian GDP growth of 2.9% in 2022 and 0.9% in 2023, vs 2.4% and 1.9% in previous outlook.
Market reaction
The quarterly forecasts have little to no impact on the shared currency, as EUR/USD continues to gyrate above parity so far this Thursday.
At the time of writing, the pair is trading at 1.0022, down 0.37% on a daily basis.