Eurozone –2025-2026 Scenario: a sluggish recovery at a slower pace than potential

Facing the relative slowdown in the US economy, growth in the Eurozone accelerated slightly over the summer, although still at a much lower rate than in the United States (0.9% year-on-year).

The upturn in household consumption seen over the summer bodes well for slightly stronger growth next year. The latest information on investment does not plead in favour of a marked acceleration. We have revised our investment forecast downwards and postponed its recovery until 2026.

Our GDP growth forecasts for 2024 and 2025 have therefore been reduced (from 0.8% to 0.7% and from 1.3% to 1% respectively). In 2026, GDP growth should return to its potential rate of 1.2%, but the slightly negative output gap will not yet have been closed.

This pace would not be enough to halt a further widening of the growth gap with the US economy, fuelled by a growing divergence in economic policies. The Trump administration's policies should have a moderately negative impact on growth in the Eurozone.