Euro zone growth forecasts trimmed, but overall economy still looking good.
The European Commission trimmed its 2008 and 2009 growth forecasts for the euro zone and hiked its inflation outlook for the bloc. 'Economic growth is moderating in the EU and euro area and the current, imported inflationary pressures are a matter of concern,' economic and monetary affairs commissioner Joaquin Almunia said of the commission's latest set of economic forecasts. The European Union's executive arm is now expecting growth of 1.7 percent this year rather than the 1.8 percent it predicted in its interim forecasts published on Feb 21. For next year, it has cut its growth projection to 1.5 percent from the 2.1 percent given in its autumn forecasts published on Nov 9. The commission attributed the expected moderation in growth to persisting turmoil in the financial markets, the marked slowdown in the U.S. and soaring commodity prices. On the inflation front, it hiked its 2008 inflation forecast to 3.2 percent from the 2.6 percent expected in February.
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