Economic outlook, analysis and forecasts

Euro Area - Economic forecast summary (May 2018)


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Economic growth in the euro area is set to continue at a relatively dynamic pace of just above 2 per cent over 2018-19. Accommodative monetary policy, fiscal support and improving labour markets are supporting domestic demand, notably through dynamic private consumption. Investment is strengthening, on the back of favourable financing conditions, strong global demand and the need to expand capacity. Inflation is expected to strengthen gradually, as slack disappears. 

Monetary policy should be firmly committed to remaining accommodative as long as needed to attain the inflation objective, while preparing for a gradual normalisation. The euro area fiscal stance is projected to be slightly expansionary in both 2018 and 2019. As the expansion consolidates, governments should improve their fiscal positions and reduce debt ratios. Improving skills, reforming product markets, completing the single market for goods and services, and progress with banking union, are the best guarantee for stronger and more inclusive growth.

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Other information

Economic Survey of the Euro Area (survey page)

Economic Survey of the European Union (survey page)

The Economic Consequences of Brexit: A Taxing Decision (main web page with paper)


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