Russia’s invasion of Ukraine has posed new challenges to the EU economy, just as the Union had recovered from the economic impacts of the pandemic. By exerting further upward pressures on commodity prices, causing renewed supply disruptions and increasing uncertainty, the war is exacerbating pre-existing headwinds to growth, which were previously expected to subside. This has led the European Commission to revise the EU’s growth outlook downwards, and the forecast for inflation upwards.
Real GDP growth in both the EU and the euro area is now expected at 2.7 % in 2022 and 2.3% in 2023.
Inflation in the euro area is projected at 6.1% in 2022, before falling to 2.7% in 2023. For the EU, inflation is expected to increase from 2.9% in 2021 to 6.8% in 2022, and fall back to 3.2% in 2023.
Unemployment rates are forecast to decline further, to 6.7 % this year and 6.5% in 2023 in the EU and to 7.3 % and 7.0 % in 2022 and 2023 respectively in the Euro Area.You can follow the press conference by Commissioner Gentiloni live on Ebs. A press release is available online.