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BRUSSELS, July 19 (Xinhua) -- The European Union (EU) downgraded its economic outlook for the United Kingdom and the rest of the bloc1 on Tuesday, saying the Brexit vote ushered2 in uncertainty3 and would weigh on growth.
The gross domestic product (GDP) growth in the 19-country eurozone is expected to slow to between 1.3 and 1.5 percent in 2016 from the previously4 estimated 1.7 percent in May. The same growth figures are expected for next year.
This implies a loss of GDP of 0.25 to 0.5 percent by 2017, which is less than in the UK (1.0 to 2.75 percent), said a report published by the European Commission, the bloc's executive arm. "The UK's 'leave' vote is expected to slow private consumption and investment and impact on foreign trade," it noted5.
EU says Brexit vote to worsen UK, EU economic outlook
The report warned that the UK's referendum had created an "extraordinarily6 uncertain situation," which is likely to prevail for some time, and would affect not only the UK but also the rest of the EU economy through several transmission channels, mainly uncertainty, investment, trade, and migration7.
The increased uncertainty in the UK and other member states was expected to hamper8 investment decisions either by delaying them or by taking them off the table, at least until the uncertainty diminishes.
While the bloc is struggling to fight the almost double-digit unemployment rate, unfortunately, the Brexit vote is predicted to slow the ongoing9 labor10 market recovery as increased risk aversion and subdued11 domestic demand would have a negative impact on firms' hiring decisions.
Inflation is another major concern for the bloc, which is keen to hit a target of around 2.0 percent. The conclusion of the report is welcoming though as it suggested that the Brexit vote's impact on inflation in the single currency zone would be "only marginal."
Moreover, the vote has increased or even created political risks which, if they were to materialize, could massively alter the forecast. However, such risks are extremely difficult to quantify, the report said.
Overall, the UK's "leave" vote has increased risks to the outlook with downside risks strongly dominating, it added.
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1 bloc | |
n.集团;联盟 | |
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2 ushered | |
v.引,领,陪同( usher的过去式和过去分词 ) | |
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3 uncertainty | |
n.易变,靠不住,不确知,不确定的事物 | |
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4 previously | |
adv.以前,先前(地) | |
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5 noted | |
adj.著名的,知名的 | |
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6 extraordinarily | |
adv.格外地;极端地 | |
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7 migration | |
n.迁移,移居,(鸟类等的)迁徙 | |
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8 hamper | |
vt.妨碍,束缚,限制;n.(有盖的)大篮子 | |
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9 ongoing | |
adj.进行中的,前进的 | |
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10 labor | |
n.劳动,努力,工作,劳工;分娩;vi.劳动,努力,苦干;vt.详细分析;麻烦 | |
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11 subdued | |
adj. 屈服的,柔和的,减弱的 动词subdue的过去式和过去分词 | |
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