Euro area economy to grow quicker than estimated in 2025 – EU Commission

• 2025 Eurozone GDP growth forecast seen at 1.3% (previously 0.9%)
• 2026 Eurozone GDP growth forecast seen at 1.2% (previously 1.4%)
• 2025 Eurozone inflation seen at 2.1%, 2026 at 1.9%, 2027 at 2.0%

Besides the standard estimates above, the commission sees some optimism arising from France despite the political struggles this year. They estimate the French budget deficit at 5.5% of GDP in 2025 and sees that easing further to 4.9% in 2026. As for Germany, they see the budget gap rising to 3.1% of GDP in 2025 before increasing further to 4.0% in 2026. As a reminder, the general rule of thumb is that member states must keep government deficit below the threshold of 3% of GDP.

This article was written by Justin Low at investinglive.com.