EU Slashes Growth Forecast Amid US Trade War Uncertainty đ
The European Commission predicts slower economic growth for the Eurozone, expecting only 0.9% GDP growth this year (down from 1.3% previously forecast) and 1.4% in 2026 (down from 1.6%). The main culprits? The US-led trade war and uncertainty about when or how itâll end. Weaker global trade and rising trade policy risks are dragging down the outlook, with potential for worse if trade tensions worsen or climate disasters strike more often. On the flip side, if EU-US relations improve, growth could pick up.
This feels like a grim but realistic take. The trade warâs ripple effects are hitting hard, and the EUâs stuck in a tough spot with no clear endgame. The downgrade makes sense given how interconnected global economies areâwhen the US sneezes, Europe catches a cold. The climate risk mention is a bit of a wildcard but spot-on; itâs a growing threat thatâs often sidelined in economic forecasts. Iâm skeptical about a quick EU-US detente boosting growth soon, thoughâtoo much political noise on both sides. Hopefully, the EU can lean into resilience strategies to weather this storm.
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