European Commission upgrades its EZ growth forecasts for 2018 and 2019

The European Commission unveiled its latest forecasts for the Euro-zone’s booming economy.

   •  2017 EZ HICP 1.5% (Nov. estimate 1.5%; ECB 1.5%) - 2018 EZ HICP 1.5% (Nov. estimate 1.4%; ECB 1.4%) - 2019 EZ HICP 1.6% (Nov. estimate 1.6%; ECB 1.5%)
   •   Core inflation is expected to stay subdued as labour market slack recedes only slowly and wage pressures remain contained
   •  Headline inflation will continue to reflect the significant influence of energy prices

   •  2017 EZ GDP Growth: 2.4% (Nov. estimate 2.2%; ECB 2.4%) - 2018: 2.3% (Nov. estimate 2.1%; ECB 2.3%) - 2019: 2.0% (Nov. estimate 1.9%; ECB 1.9%)
   •  Risks to this growth forecast remain broadly balanced
   •  Growth could exceed expectations in the short term due to high level of sentiment

Additional headlines:

   •  Downside risks include uncertain outcome of Brexit talks, geopolitical tensions, a shift toward more inward-looking and protectionist policies
   •  In the medium term, high global asset prices could be vulnerable to a re-assessment of risks and fundamentals