Trade tensions spell trouble for the Eurozone economy
Growth in the eurozone economy lost steam in September as European factories saw diminished demand amid Brexit tremors and the effects of a multi-front Trump trade war, a key survey showed on Thursday.
Data monitoring company IHS Markit warned that export growth was evaporating in the 19-country single currency bloc, even though powerhouses Germany and France continued to outperform. A near stagnation of exports contributed to one of the worst months for the eurozone economy for almost two years, said Chris Williamson, Chief Business Economist at IHS Markit. Trade wars, Brexit, waning global demand (notably in the auto industry), and rising political uncertainty both within the Eurozone and further afield all fueled the slowdown in business activity, he said.
Amid the trade tensions as well as concerns about emerging markets, the European Central Bank now expects growth of 2.0 percent in 2018 and 1.8 percent in 2019.