Marco Buti, Oliver Dieckmann, Björn Döhring, Bertrand Marc, Andreas Reuter, 07 May 2019

The sharper-than-expected economic slowdown in the euro area last year was driven by a confluence of weaker export demand and sector- and country-specific factors within the euro area. This column introduces the European Commission’s Spring 2019 Forecast, which projects a moderate rebound over the course of this year as global demand bottoms out and some temporary negative factors fade. This will depend on domestic demand holding up despite the stark slowdown in manufacturing, however, and the baseline scenario is subject to downside risks, some of which could be triggered by misguided economic policies. Economic policy should therefore stand ready to react to a sharper and more protracted slowdown should it occur. 

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