MNI: EU Commission Ups '18 Growth Forecast for Eurozone

--Forecast for 2018 EMU Inflation Raised, 2019 Unchanged

     LONDON (MNI) - The European Commission raised its 2018 and 2019 forecasts

for euro area growth Wednesday and upped its outlook for prices this year.

     In its Winter economic forecasts, the Commission said Eurozone growth will

likely be 2.3% this year, above the 2.1% forecast in October. For 2019, euro

area growth should come in at 2.0%, the EC said, also up from the October

forecast.

     Euro area inflation is expected to average 1.5% this year, above the

October forecast, then rise to 1.6% in 2019.

     The Commission said that the European economy has performed significantly

better than expected this year, propelled by resilient private consumption,

stronger growth around the world, and falling unemployment. 

     "Growth rates for the euro area and the EU beat expectations last year as

the transition from economic recovery to expansion continues. The euro area and

EU economies are both estimated to have grown by 2.4% in 2017, the fastest pace

in a decade. This robust performance is set to continue in 2018 and 2019 with

growth of 2.3% and 2.0% respectively in both the euro area and EU," the

statement said.

     "Europe's economy has entered 2018 in robust health. The euro area is

enjoying growth rates not seen since before the financial crisis. Unemployment

and deficits continue to fall and investment is at last rising in a meaningful

way," Economic and Financial Affairs chief Pierre Moscovici said in a statement 

     "Economic growth is also more balanced than it was a decade ago - and

provided we pursue smart structural reforms and responsible fiscal policies - it

can also be more durable. This window of opportunity to reform will not remain

open forever: the moment to take the necessary ambitious decisions to strengthen

the Economic and Monetary Union is now," he added.  

     The Commission cut its 2017 UK growth forecasts. The EC cut the 2018 GDP

outlook to 1.4% from October's 1.5%, with 2019 forecast lowered 1.1%. The EC

said assumptions made in making UK forecasts were made on a purely technical

assumption of status quo, which had no bearing on the current Article 50

process.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: M$B$$$,M$E$$$,M$X$$$,MI$$$$,MT$$$$]