The market now IMF: Europe’s economy is unlikely to crash — even as a more-than yearlong bout of rate hikes tames inflation. “The outlook for Europe is for a soft landing, with inflation declining gradually,” the fund said, forecasting 0.7% growth for the Eurozone in 2023 and 1.2% in 2024. While that seems a bit too optimistic – the Eurozone economy has grown a paltry 0.025% on average during the last four quarters – it hardly matters from a debt perspective. The Eurozone is expected to run a budget deficit of 3.6% of GDP this year and 3.0% next. Debt-to-GDP ratios – already elevated – will further increase even without a crisis or recession (which may still come by the way).
Excellent report, thank you!