2010.09.1306:19:00UTC+00Eurozone 2010 GDP Growth Forecast Revised Up

Eurozone real gross domestic product is forecast to grow at a pace of 1.7% this year, revised up from 0.9%, the latest interim forecast issued by the European Commission showed on Monday. This upward revision largely reflects a better than expected first half economic growth.

GDP is projected to expand by 0.5% in the euro area in the third quarter and 0.3% in the fourth quarter of 2010. The commission said the brighter outlook is supported, inter alia, by sentiment indicators which point to a continuing expansion of economic activity in the coming months.

For 2010, real GDP growth is expected at 1.8% in the EU. However, growth is estimated to ease in the second half of 2010, reflecting the softening of the global economy and the fading of the temporary factors that kick-started the recovery.

The Commission's inflation forecast for 2010 is broadly unchanged since the spring, at 1.8% in the EU and 1.4% in the euro area. The first half of 2010 saw a moderate rise in HICP inflation, on the back of rising global commodity prices and upward food and energy base effects, the report said.

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