Hostname: page-component-78c5997874-dh8gc Total loading time: 0 Render date: 2024-11-10T12:26:47.895Z Has data issue: false hasContentIssue false
  • English
  • Français

The euro and prospects for growth in Europe

Published online by Cambridge University Press:  26 March 2020

Get access Rights & Permissions [Opens in a new window]

Extract

In 2008 and 2009, real GDP growth in the Euro Area is forecast to settle in the 1½–1¾ per cent range, ¼ to ½ percentage points less than expected in January. The downward revision in part reflects the downgrading in world growth prospects, in particular for the US. Recent economic indicators for Euro Area countries indeed remain relatively favourable. The most recent early indicators available for the start of 2008 are also conducive to moderate optimism. At around 2½ per cent for HICP both in 2008 and 2009, inflation projections are a little above the January forecast due to the pass-through of higher oil prices on domestic costs. The impact of energy prices on overall inflation has however been mitigated by the euro's continued appreciation, which has also contributed to prospects for slower growth. The main downside risks to the current forecast are linked to the high energy prices and to how European banks will respond to spillovers from the US subprime crisis.

Type
Articles
Information
National Institute Economic Review , Volume 204 , April 2008 , pp. 22 - 32
Copyright
Copyright © 2008 National Institute of Economic and Social Research

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Al-Eyd, A. and Barrell, R. (2006), ‘Consumption in the Euro Area’, National Institute Economic Review, 195.Google Scholar
Aviat, A., Bricongne, J-C. and Pionnier, P-A. (2007), ‘Richesse patrimoniale et consommation: un lien ténu en France, fort aux Etats-Unis’, INSEE, Décembre 2007Google Scholar
Barrell, R. and Holland, D. (2007), ‘Banking crises and economic growth’, National Institute Economic Review, 202, October.Google Scholar
Barrell, R., Holland, D. and Hurst, A.I. (2008), ‘Sustainable adjustment of global imbalances’, in Aslund, A. and Dabrowsk, M. (eds), Challenges of Globalization: Macroeconomic Imbalances and Development Models, Peterson Institute of Internatioal Economics.CrossRefGoogle Scholar
Barrell, R., Holland, D., Liadze, I. and Pomerantz, O. (2007), ‘Fiscal spillovers and trade relations in Europe’, National Institute Discussion Paper no. 289.Google Scholar
Fic, T., Barrell, R. and Holland, D. (2008), ‘Entry rates and the risks of misalignment in the EU8’, Journal of Policy Modeling, forthcoming.CrossRefGoogle Scholar
Goldman Sachs (2007), ‘The subprime issue: a global assessment of losses, contagion nd strategic implications’, 20 Novemkber.Google Scholar
Greenlaw, D., Hatzius, L., Kashyap, A. and Shin, H.S. (2008), ‘Leveraged losses: lessons from the mortgage market meltdown’, US Monetary Policy Forum, February.Google Scholar
IMF (2008), Global Stability Reoprt, April.1.Google Scholar
IMF (2008a), World Economic Outlook, ‘The Changing Housing Cycle and the Implications for Monetary Policy’, Box 3.1, April 2008.Google Scholar
Lehman Brothers (2007), ‘Securitized products outlook 2008: bumpy road to recovery’, 13 December.Google Scholar