Press Release: Commissioner Solbes presents the Autumn 2000 EU Economic Forecasts (2000-2002)

According to the Autumn 2000 EU Economic Forecasts, the economic situation is the best for ten years, based on both solid domestic fundamentals and a positive contribution coming from rising world demand. Average GDP growth in the EU is forecast to remain around 3%. The slowdown from the high growth rate of 3.4 % estimated in 2000 is mainly due to the abrupt hike in oil prices. This is also the reason why average inflation in the euro area will be above 2 % this year and next. The weakness of the euro adds to imported inflation, but core inflation remains subdued. Continued employment creation and tax cuts underpin good growth in disposable income. Public finances improve further, but the structural consolidation effort is waning as the growth dividend is partly used for tax cuts. The large general government surplus likely to be realised in 2000 is mainly thanks to the proceeds of the UMTS licences.

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