[PAGE_3]Summary[/PAGE_3]
[PAGE_8]The international context[/PAGE_8]
[PAGE_9]Focus: the impact of Trump 2.0[/PAGE_9]
[PAGE_17]Latest economic trends[/PAGE_17]
[PAGE_18]Households[/PAGE_18]
[PAGE_22]Corporates[/PAGE_22]
[PAGE_29]Risks[/PAGE_29]
[PAGE_30]The scenario in figures[/PAGE_30]
CitationThe direct macroeconomic impact of Trump’s policy announcements would be moderately negative for the Eurozone. The uncertainty channel will play an important role in the short term. While higher tariffs may reduce global and Eurozone trade, expansionary fiscal policy in the US may boost demand for European products. The final outcome will depend on the balance between the extent of fiscal easing and the increase in customs duties, but also on the sequence in which these policies are implemented.
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.
