European economic forecast : winter 2022 (Interim)

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      <subfield code="a">The EU economy entered the new year on a weaker note than previously projected. Having regained the pre-pandemic output level in summer last year, a moderate slowdown was already expected in the Autumn Forecast. However, since then headwinds to growth have intensified. After a soft patch, the economic expansion is set to regain pace in the second quarter of this year and remain robust over the forecast horizon. Following a strong recovery by 5.3% in 2021, the EU economy is now forecast to grow by 4.0% in 2022, as in the euro area, and by 2.8% in 2023 (2.7% in the euro area). The resurgence of the pandemic last autumn and the exponential spread of the new Omicron variant have led to renewed strains on healthcare systems and an unprecedented surge of absences from work in many EU countries. Governments across the EU have reinstated restrictions- though generally of a milder or more targeted nature than in previous waves. Persistent logistic and supply bottlenecks, including shortages of semiconductors and some metal commodities, keep weighing on production, as do the elevated prices of energy. Stronger than expected inflationary pressures weigh on households' purchasing power.</subfield>
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