EU to Downgrade Growth Forecasts, Raise Inflation Projections Amid Iran Conflict, Says Commissioner

According to CNBC, on May 18, EU economic affairs commissioner Dombrovskis said the bloc would downgrade economic growth forecasts and raise inflation projections due to the stagflation shock from the Iran conflict. Spring economic forecasts to be released later this week will show lower growth and higher inflation, he stated. Dombrovskis noted that policymakers now have limited room for large-scale fiscal measures similar to those deployed during the pandemic. The EU is releasing strategic oil reserves as supply concerns mount in alternative fuels sectors.