Economists have cut their forecasts for Eurozone growth this year and next in line with lower expectations for the global recovery, according to a survey released today.
Analysts in the survey, taken between August 12th and 15th, said a stream of poor economic data, revisions to US figures to show negative growth in the first three quarters of 2001 and weak equity markets had prompted the downward revisions.
The mid-range of 31 forecasts for gross domestic product growth this year was 1 per cent compared with 1.4 per cent in the May survey. Next year GDP growth is expected to average 2.5 per cent compared with 2.8 per cent.
Earlier this year, economic data signalled a strong growth rebound after last year's global downturn, but plunging stock markets and weak demand at home and abroad have forced the downward revisions to Eurozone growth.
Consumer and corporate reaction to the drop in equity prices varies between countries, but economists agree sentiment in the 12-nation bloc will be affected.