European Commission cuts eurozone growth forecasts

The European Commission cut its eurozone growth forecasts on Wednesday as it said the economy has lost momentum.

The Commission now expects GDP growth of 0.6% for this year and 1.2% in 2024. This is 0.2 percentage points below the summer forecast.

Headline inflation in the eurozone is expected to fall from 5.6% in 2023 to 3.2% next year and 2.2% in 2025. In the EU, meanwhile, headline inflation is set to drop from 6.5% in 2023 to 3.5% in 2024 and 2.4% in 2025, the European Commission said.

"The European economy has lost momentum this year against the background of a high cost of living, weak external demand and monetary tightening," it said.

"While economic activity is expected to gradually recover going forward, the European Commission's autumn forecast revises EU GDP growth down compared to its summer projections. Inflation is estimated to have dropped to a two-year low in the euro area in October and is set to continue declining over the forecast horizon."