IMF warms to eurozone economy amid lower political risks
LONDON — The International Monetary is more optimistic about the economy of the 19-country eurozone after a run of elections saw populist politicians defeated and risks to its outlook abated.
In an update to its April projections published Monday, the IMF revised up its growth forecasts for many eurozone countries, including the big four of Germany, France, Italy and Spain, after stronger than anticipated first quarter figures.
Germany, Europe’s biggest economy, is projected to grow by 1.8 per cent, up 0.2 percentage point on the previous estimate, while France is forecast to expand 1.5 per cent, up 0.1 percentage point. Projections for Italy and Spain have been revised higher by a substantial 0.5 percentage point. The two are now expected to grow by 1.3 per cent and 3.1 per cent, respectively. All four are also expected to grow by more than anticipated in 2018.
Overall, the IMF expects the eurozone to expand by 1.9 per cent this year, 0.2 percentage point more than its previous projection. That’s just shy of the IMF’s 2.1 per cent forecast for the U.S., which was trimmed by 0.2 percentage point. However, it’s slightly ahead of Britain’s, whose projected growth was revised down 0.3 percentage point to 1.7 per cent following a weak first quarter that raised concerns about the country’s economy ahead of its exit from the European Union.