EU Commission downgrades 2026 GDP growth forecast to 0.9% (prev. 1.2%), 2026 inflation revised to 3.00% (prev. 1.9%)

Before the outbreak of the conflict in the Middle East, the global economy was gaining momentum. A challenging geopolitical environment and US tariff uncertainty continued to weigh on growth, but easing inflation and a robust investment cycle related to the unfolding AI revolution provided important support. The EU economy was likewise strengthening while inflationary pressures were further abating. The conflict materially changed this picture, delivering one of the most significant global energy supply disruptions in recent history.