Spring 2023 Economic Forecast: An improved outlook amid persistent challenges

The European economy continues to show resilience in a challenging global context. Lower energy prices, abating supply constraints and a strong labour market supported moderate growth in the first quarter of 2023, dispelling fears of a recession. This better-than-expected start to the year lifts the growth outlook for the EU economy to 1.0% in 2023 (0.8 % in the Winter interim Forecast) and 1.7 % in 2024 (1.6 % in the winter). Upward revisions for the Euro Area are of a similar magnitude, with GDP growth now expected at 1.1 % and 1.6 % in 2023 and 2024 respectively. On the back of persisting core price pressures, inflation has also been revised upwards compared to the winter, to 5.8 % in 2023 and 2.8 % in 2024 in the Euro Area.

More information is available in a press release online.