The Organisation for Economic Co-operation and Development raised its euro area economic growth forecast for 2026 amid the Middle East conflict, expecting energy prices to normalize and new defense spending initiatives to accelerate.
In its latest Economic Outlook report published Wednesday, the OECD said it now expects the eurozone's gross domestic product to grow 1% in 2026, up 0.2 percentage points from its June forecast. For 2027, GDP is projected to grow 1%, down 0.2 percentage points from the prior estimate.
Meanwhile, the projected headline inflation rate in the region is expected to stand at 3% in 2026 and 2.9% in 2027, up by 0.2 percentage points and 0.5 percentage points, respectively, from the previous estimates.