The euro zone will expand slightly more slowly next year than expected because of weaker private demand and investment, while inflation will stay well below the central bank target over the next two years.
The European Commission forecasts, published on Tuesday, are likely to add to arguments for an interest rate cut by the European Central Bank, which is to discuss its next policy move on Thursday.
The Commission forecast that the economy of the 18 countries that will share the euro from next year will expand 1.1 percent in 2014 after a 0.4 percent contraction this year. In 2015, the euro zone is to accelerate to growth of 1.7 percent.
The last Commission forecast in May saw euro zone growth of 1.2 percent in 2014. But recession is behind the euro zone and the pace of recovery will slowly accelerate quarter-on-quarter.
"There are increasing signs that the European economy has reached a turning point," said EU Economic and Monetary Affairs Commissioner Olli Rehn. "The fiscal consolidation and structural reforms undertaken in Europe have created the basis for recovery."
Source: Reuters
