IMF lowers eurozone growth forecast to 0.9% amid energy disruptions
The International Monetary Fund, or IMF, just lowered its eurozone growth forecast for this year to 0.9%, thanks to ongoing energy disruptions caused by the Middle East conflict.
Oil and gas supplies have taken a hit, with the closure of the Strait of Hormuz and damaged production facilities making things tougher for businesses and consumers.
ECB hikes interest rates to 2.25%
Inflation is expected to rise higher than planned, with the IMF now predicting 2.8% for 2026 instead of 2.6%.
Consumer confidence would weaken if energy disruptions persist, which could mean less spending in the eurozone.
To tackle inflation, the European Central Bank bumped up interest rates to 2.25%, and it is likely we will see another increase before year-end.
The ECB also trimmed its own growth outlook to just 0.8%, highlighting how uncertain things are right now.