ExpertEye European Automotive Report Q2 2016 | Page 4
European GDP
.
GDP has returned to pre-crisis
crisis levels but it has taken much longer than other parts of the world. Whilst growth outside the EU has slowed it
is still running at around 3.2%-3.4%,
3.4%, well above EU levels of 2.0% in 2015 and forecasts of 1.8% (2016) and 1.9% (2017).
Whilst weaker than in previous years the euro has strengthened against a number
number of its major trading currencies, therefore growth is set to
remain dependant on domestic demand which is still slowly rising thanks to recovering labour markets and very low inflation and
a interest
rates.
However slowdowns in emerging markets, political tension
tension across Europe, migration, terrorism and Brexit all create considerable downside
risks and uncertainty over the short to medium term.
Most economists agree that one of the keys to easing uncertainty is the UK and EU quickly establishing post-exit
post
trading and financial
relationships that preserves a status quo between the two as much as possible. But with the financial markets remaining relatively
relat
calm,
post the referendum result, recent forecasts from the IMF and European Commission have seen them move
move away from the severe downside
forecasts they had predicted.
+5
+4
+3
+2
+1
+0
-1
-2
-3
-4
-5
% GDP Growth
EU (28 countries)
Germany
Spain
France
Italy
Portugal
2010
2011
2012
2013
2014
2015
2016e
2017e
United Kingdom
Source: European Commission, OECD and the IMF
European Automotive Report - 2016 Quarter 2
3