Euro Area Macro Monitor

Euro area economic growth is losing momentum as energy costs weigh on consumption and industrial resilience. Danske Bank has downgraded its 2026 GDP growth forecast to 0.7% amid persistent inflation and shifting ECB policy expectations.

Key Takeaways

• 1.Euro area growth revised down to 0.7% for 2026 due to weakening economic activity and energy price impact.
• 2.Headline HICP inflation rose to 3.2% in May, driven by energy costs, while ECB is expected to hike rates by 25bp in June and July.
• 3.Labour market momentum has stalled, with negotiated wage growth falling to 2.5% in Q1.

Table of Contents

• Euro Area
• Germany
• France
• Italy
• Spain
• Disclosures

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