The European Commission lowered its GDP forecasts for 2020 and 2021, saying that the lifting of COVID-19 lockdown measures in some countries was proceeding less swiftly than it had initially predicted.
The EU executive said the bloc would shrink by a record 8.7 percent this year, before rebounding by 6.1 percent in 2021, compared with early May estimates of a 7.7 percent contraction in 2020 and a 6.3 percent recovery next year.
Among the bloc’s largest economies, Italy and Spain are seen posting the steepest contraction rates, with the GDP falling by 11.2 (vs -9.5 percent seen in May) and 10.9 percent (vs -9.4 percent seen in May), respectively.
France’s economy is forecast to shrink 10.6 percent (vs -8.2 percent seen in May), while Germany’s GDP will probably drop by 6.3 percent (vs -6.5 percent seen in May).
The Euro Area economy contracted by 3.1 percent from a year earlier in the first quarter of 2020.