An important question will concern whether the savings accumulated during past lockdown periods are unwound, and about the pace of decline of the savings rate, once restrictions ease. These include the extent to which the EU can benefit from the improved external environment the continuation of adequate policy support the response of households and companies and the extent to which the crisis leaves long‑term scars on the economy. …although a number of other key issues will also play an important role…Ī number of other factors will also be critical to the outlook. Table 1 : Overview - the spring 2021 forecast It is therefore assumed that some limited containment measures will be in place as needed. In 2022, COVID-19 will remain a public health concern, despite the high share of the population being vaccinated (including refreshed protection when needed, for example due to new variants). For the EU, the forecast assumes that following a marginal easing of restrictions in the course of the second quarter, progress in vaccinations will enable a more marked easing of restrictions in the second half of the year. …and the pandemic is still setting the course for 2021-2022…Įconomic developments in 20 will be largely determined by how successfully vaccination programmes will tame the pandemic and how quickly governments will lift restrictions.

Better adaptation of firms and households to the constraints of the pandemic environment, stronger support from global growth and trade, and continued strong policy support helped economic agents cope with the economic challenges. However, considering the stringency of the restrictions, the decline in activity was far milder than the downturn in the first half of 2020. With output falling again in the last quarter of 2020 and the first of 2021, by a cumulative 0.9%, the EU was pushed back into recession. The EU entered the year on a weak footing…Īfter the historic drop in activity recorded in the first part of 2020 and the rebound in the summer, the EU economy faced another setback in late 2020 as the resurgence of the pandemic prompted a new round of containment measures.

Currency outlook 2021