Research Detail

2022/12/16 / Erste Group Research

Economic outlook brightens somewhat
Despite the continuing concerns and high degree of uncertainty regarding the outlook, initial sentiment indicators have recently begun to brighten somewhat. In addition, the financial markets are also signaling an increase in investors' appetite for risk through exchange rates (in particular the weakening of the US dollar against all major currencies) and a narrowing of risk premiums on the bond market.

This is mainly due to the increasing likelihood that inflationary dynamics have finally peaked. As a result, the most important central banks have recently been able to slow down the pace of interest rate hikes somewhat. Against this backdrop, we believe the outlook for the Eurozone economy in 2023 has brightened somewhat.

We are therefore raising our GDP forecast for the Eurozone to +3.4% in 2022 (previously +3.2%) and to +0.5% in 2023 (previously +0.3%). Thanks to funding from the EU recovery plan, we also expect Italy and Spain to outperform in 2023.

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General information

Author	Erste Group Research
Date	2022/12/16
Language
Product name	Week ahead
Topic in focus	Macro/ Fixed income
Economy in focus	Eurozone, United States
Currency in focus	Euro, US Dollar
Sector in focus	-
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