European economic researchers see the economy in the eurozone picking up speed again. "The main driver of this development is household consumption," the research institutes Ifo (Munich), Kof (Zurich) and Istat (Rome) said on Wednesday. But, they said, "in the first half of 2020, industrial production and investment will also pick up again, after a decline in the fourth quarter of 2019."
After only 0.2 percent economic growth in the third quarter of 2019, euro zone growth in the fourth quarter is likely to have been 0.3 percent, and in the first two quarters of the new year the economy is also likely to grow by 0.3 percent quarter-on-quarter in each case, according to the three institutes. Prices in the eurozone are likely to be 1.3 percent higher year-on-year in the current quarter and 1.2 percent higher in the second quarter.
The forecast is based on an oil price of 65 dollars per barrel of crude oil and an exchange rate of 1.12 dollars to the euro. Risks for growth in the eurozone are Brexit, the strikes against the pension reform in France, the conflict between the United States and Iran and the trade dispute between the United States and China. Overall, however, the researchers estimate that the risks for economic development in the eurozone have decreased somewhat.
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