Frankfurt: U.S. President Donald Trump’s tariff offensive has caused European officials to cut growth forecasts this year and next year – with the highest interest rates for most commodities being negotiated even in the best case.
The EU Executive Committee said in its regular spring forecast on Monday that the forecast for 20 countries using the euro currency fell to 0.9% this year, compared with 1.3% in November’s previous forecast.
The forecast for 2026 fell from 1.6% to 1.4%.
One reason for the low growth estimate is the stagnation of the German economy, which is expected to be zero this year after two years of output shrinkage.
Germany’s economy depends largely on exports, but a huge headwind for Russian gas due to losses infringement by Ukraine and the lack of infrastructure spending to promote growth and China’s competition in China in automobiles and industrial machinery.
