Brussels sees “5 good news” and “3 risks” for the european economy – Jornal de Negócios – Portugal

The european economies will continue to grow very moderately over the next two years but, despite the difficulties, continue to be solid. Pierre Moscovici, who was to present the general lines of the Autumn forecasts, is moderately optimistic, having identified five “good news” and “the three risks”.

One of the good news is that, despite the weaknesses and the performances are quite disparate between countries, the GDP is expected to increase in all member States in the face of 2016. On average, the countries will advance to 1.6% of GDP, but thanks to the higher strength of countries such as Poland, Spain and the Netherlands the contrabalançarem the lower dynamism of France, Germany or Italy.

This rise in global growth is due mainly to private consumption which results from the second good new: the creation of employment, which will continue to rise, even beyond the expectations. France recognizes that it is to look at the part half full of the cup, because “the total number of jobs is still lower than that which existed ten years ago and the new jobs created are part-time”, but the fact that the overall unemployment rate back to 9.2% in 2018 will raise the income of households and, through this, stimulate consumption.

The third “good news” is in the investment, “finally on high”, the rise of 3.3% in 2016 to 3.5% in 2017. To contribute to this momentum are a jerk of the plan Juncker, the european funds that “should give very positive results and tangible in its deployment phase,” and yet what Moscovici describes as a “monetary policy exceptionally receptive” on the part of the European Central Bank.

inflation, which will rise from 0.3% in 2016 to 1.4% in the next year is another effect of the “welcome”, thanks to the price of oil and the increase of wages and the income of families.

the Fifth and final positive trend is that member States are putting the public accounts on the day, with the shortfall added to reach 1.5% of GDP over the next two years. Spain is one of the few countries that will remain above 3% in 2017 (if the France comply with the agreed upon), but France reminds us that it is a skid consented and even “consistent with the recommendation made to the Country”.

The three risks

Already the side the pessimistic of the commissioner is powered by Brexit, by China and by european banks.

According to the european commissioner for economic and monetary affairs the Brexit will continue to increase political uncertainty in the European Union, this despite acknowledging that, for now, “the euro area withstood the first impact”.

Although the european economy is in recovery, Moscovici does not anticipate the great help of the external factors, quite to the contrary. Energy prices are already recovering, the devaluation of the euro is being inverted and there that add to this the slower growth of the chinese economy and the risks of aggravation of the geopolitical conflict which, according to Brussels, have increased.

The third headache for Brussels is the banker that you still may not be at the height of the expansion of the investment foreseen for the coming years, given their low levels of profitability and the high level of bad debt in their balance sheets.