ECB Euro Area Economic Outlook: Moderate Growth Despite Trade Challenges

The ECB’s September 2025 staff macroeconomic projections indicate that the euro area economy is expected to grow moderately, with real GDP rising by 1.2% in 2025, 1.0% in 2026, and 1.3% in 2027. Growth is expected to be supported by rising wages, increased government spending on infrastructure and defense, and improved financing conditions, despite challenges from higher US tariffs and subdued foreign demand.
Moreover, inflation is projected to stabilize around the ECB’s medium-term target of 2%, with energy price volatility and climate-focused fiscal measures influencing inflation trends. The labour market remains resilient, while export prospects are dampened by competitive pressures and tariffs, leading to slower export growth but sustained import activity.
Read more on the ECB’s website.