Forecasters' views of European growth are anchored in an increasingly pessimistic view of its potential
Forecasters' views of European growth are anchored in an increasingly pessimistic view of its potential. The economic forecasters surveyed regularly by the European Central Bank to discern their views about the growth prospects of the Euro region have become slightly more optimistic about the near term outlook but do not expect the rate of growth in the coming year to significantly exceed 1%. In the September quarter survey, forecasters were expecting GDP growth of 1.3% in the year ahead. The chart shows the changing view of forecasters since 1999 about near term growth prospects. The shorter term forecasts have risen within a longer term reappraisal of European growth potential. Over the coming five years, forecasters expect growth to rise to 1.8%. In 2001, respondents to the same survey said they expected annual long term growth rates to reach 2.7%.
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John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...
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