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European Commission Highlights Disparity In Regions Growth

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European Commission Highlights Disparity In Regions Growth

The European Commission (EC) has today published it’s Spring 2014 Economic Outlook report for the 28 nation European Union. Statistical focus in particular is on the three key metrics of GDP growth, inflation and unemployment. The report shows a slight scaling back of the economic prospects for Europe as well as highlighting the disparate nature of the recovery across the member nations.

Forecasted GDP growth for the 28 members of the broader European union has been reduced marginally to 1.6% from 1.7% for 2014 and to 2.0% from 2.1% for 2015. Focusing only on the 18 member Eurozone bloc we see lower forecasts again, growth here is predicted at 1.2% in 2014 and 1.7% in 2015. Within the Euro area all countries are predicted to show growth in 2015, just one country, Cyprus, will not grow in 2014 as the current projection from the EC is for a contraction of up to 4.8% this year. Latvia is easily leading the way with 3.8% expansion forecast this year and a 4.1% growth outlook for 2015. Predictions for Germany are for 1.8% GDP growth this year followed by a further 2.0% expansion in 2015.

Inflationary predictions for the 28 member EU are for a 1.0% price expansion in 2014 and an additional 1.5% rise in 2015. Again the core Eurozone fares less well on this statistic, price growth for the single currency bloc is seen at just 0.8% in 2014 and 1.2% in 2015, well short of the stated European Central Bank target of 2.0%. Greece is the only country forecast to experience price contraction in 2014, the current prediction is for deflationary 0.8%. By contrast, Austria is showing 1.6% inflation this year followed closely by Estonia at 1.5%, the latter country is predicted to undergo a 3.0% general price rise in 2015.

Unemployment is projected as 10.5% this year and 10.1% next year across the EU. The Eurozone prediction is for a rate of 11.8% this year falling to 11.4% in 2015. Ten of the Eurozone economies have double digit unemployment projections currently, at 26% Greece leads this pack. Should the projections for 2015 come to pass then only eight of the 18 countries will still have a double digit unemployment rate.

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