Eurozone growth forecast for 2026 lowered due to trade tensions
According to the Sedaye Sama News Agency, According to Agence France-Presse, the European Union on Monday lowered its growth forecast for the Eurozone in 2026, as risks from international trade and geopolitical tensions continue to put pressure on the region’s economy.
The European Commission projected that the 20-member, single-currency region would grow by 1.2% in 2026, down from the previous forecast of 1.4%.
The EU executive body emphasized that Europe’s “very open” economy remains “vulnerable to current trade constraints,” noting that trade agreements between the United States and its partners, including the EU, have “reduced some of the uncertainties.”
The Commission said in a statement that ongoing uncertainty in trade policy continues to weigh on economic activity, as tariffs and non-tariff barriers could restrict EU growth beyond projected levels.
For the entire 27-member European Union, Brussels predicts growth of 1.4% in 2026, slightly below the 1.5% forecast made in May.
Valdis Dombrovskis, the EU’s economic affairs chief, adopted a positive tone despite these uncertainties, stating that the EU economy has continued to grow even in an adverse environment.
Brussels also forecasts Eurozone inflation at 1.9% in 2026, up from the previous forecast of 1.7%. The Commission expects inflation in the monetary area to reach 2.1% in 2025, close to the European Central Bank’s 2% target.
source: tasnim
