After scaling back its darkest forecasts for the European economy in November, Goldman Sachs has now fully withdrawn its recession call for the euro area.
Economists working under Sven Jari Stehn say they now anticipate a growth rate of 0.6% for the euro area in 2023. Previously, they had predicted an economic contraction of 0.1% for the region.
Lower natural gas prices and China’s reopening support the more hopeful projection, they said.
The consensus forecast among economists polled by FactSet is for a 0.1% drop in GDP for the eurozone in 2023.
Jobs, inflation
Goldman’s economists revised their outlook for the local job market, anticipating greater durability and salary increases of 5% annually in the first quarter as a result of union settlements and companies responding to inflation rates.
On the inflation front, the analysts see prices moving up by 3.3% at the end of the year as the area recovers from inflation’s peak—and…
