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According to the European Commission's latest Autumn 2024 Economic Outlook report, the EU and euro area economies are expected to grow by 0.9% and 0.8% this year, and are expected to recover to 1.5% and 1.3%, respectively, next year. Overall, this is a downward revision from the May report. After a long period of stagnation, the EU economy is returning to moderate growth, while inflation has moderated. The report also warns that geopolitical factors and structural challenges have increased uncertainty and downside risks to the regional economic outlook.

In recent months, some European countries have stepped up efforts to support businesses through tax cuts, loans, subsidies and other fiscal measures. Boosted by this policy, regional credit conditions have gradually improved, and some corporate profits have rebounded. The Autumn 2024 Economic Outlook report predicts that investment in the EU region will continue to expand in 2025. With the support of the EU Recovery and Resilience Fund, the EU plans to continue to increase investment in infrastructure, promote the transition of industrial production to green and low-carbon, and promote the digital transformation of the economy. At the household consumption level, in the first half of this year, household disposable income in the EU region maintained its recovery momentum, supported by rising employment and a recovery in real wages. At the same time, under the background of the gradual recovery of external market demand, the export trade of EU countries is also expected to achieve growth.

The Autumn 2024 Economic Outlook forecasts that EU inflation will fall from 6.4% in 2023 to 2.6% in 2024 and 2.4% in 2025. Eurozone inflation will fall from 5.4 per cent in 2023 to 2.4 per cent in 2024 and 2.1 per cent in 2025. The report said that despite certain challenges, the overall inflation slowdown in the EU is stable, and the euro area inflation rate will fall back to the target level in 2025. Some analysts also pointed out that although the eurozone inflation rate has fallen from the peak of two years ago, but the upward pressure still exists. Euro zone inflation stood at an annual rate of 2.3 per cent in November, up from 2.0 per cent in October, Eurostat data showed. Economists said rising prices for commodities such as food and gas were having an impact on overall eurozone inflation. The euro's sharp depreciation against the dollar has also contributed to inflationary pressures.

The Autumn 2024 Economic Outlook also noted that the EU economy still faces a number of challenges to growth, including persistently low consumer confidence, high living costs and frequent exposure to extreme weather events. The report warns that uncertainty and downside risks to the EU economic outlook have increased: the Russia-Ukraine conflict and the situation in the Middle East have heightened geopolitical and energy security risks; More protectionist measures by some trading partners will disrupt global trade; Policy uncertainty and structural challenges within Europe could lead to further loss of competitiveness; The increasing frequency and scope of natural disasters also have a serious impact on the economy.

European Commissioner for Economic Affairs Paolo Gentiloni said that the EU economy is slowly recovering, benefiting from favorable factors such as a recovery in investment, growth in consumption, lower unemployment and easing inflation, but structural challenges and geopolitical uncertainties are also weighing on the EU's economic growth prospects. In the future, EU member states will struggle to reduce debt levels and support growth. "It is essential for EU countries to continue to promote fiscal investment and structural reforms to enhance competitiveness, which is essential to boost potential growth and address rising geopolitical risks." "Said Gentiloni.