Europe resists energy crunch, boosting growth forecast

Europe’s economy rode out the energy price crisis triggered by Russia’s war on Ukraine with better than expected economic growth, Brussels said Monday, as it boosted its forecast.

The European Commission revised upwards its 2023 economic outlook, but also warned that inflation remains higher than hoped, maintaining pressure for higher interest rates.

The commission raised its 2023 growth outlook by 0.2 points to 1.1 percent for the 20-country eurozone single currency bloc, and to 1.0 percent for the EU as a whole.

It also raised the 2024 growth forecast for the eurozone by 0.1 points to 1.6 percent.

“The European economy is in better shape than we projected last autumn,” the EU commissioner for the economy, Paolo Gentiloni, said in a statement.

“Thanks to determined efforts to strengthen our energy security, a remarkably resilient labour market and easing supply constraints, we avoided a winter recession and are set for moderate growth this year and next.”

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