Economic Analysis Team

Why the shadow economy persists and how governments are responding

An EY study on the shadow economy finds this major contributor to the tax gap is contracting in most countries but still remains a significant problem.

Global economic outlook: Six themes for 2025

Economic activity is expected to remain stable in 2025, though there are risks. Read our global economic outlook.

The European economy is advancing at a modest pace, with a slight acceleration expected in the coming quarters

The euro area economy has been expanding at a modest rate of 0.2-0.3% q/q so far in 2024, primarily driven by a recovery in external demand and exports. Despite rising real incomes, consumer spending has been increasing sluggishly, while firms have become more reluctant to invest amid decreasing profit margins and capacity utilization, elevated real interest rates, and negative business sentiment.

EY European Economic Outlook – January 2024

The European economy remains in stagnation – we estimate that euro area GDP remained unchanged in 2023 Q4, following a 0.1% contraction in Q3 . This was due to various factors hampering economic growth, including suppressed real incomes, weak international demand, and tightening of monetary policy.

While the European economy continues to grow at a modest pace, we still expect a slight acceleration in the coming quarters

The pace of real GDP growth in the euro area remained modest in the second half of 2024, at 0.2%–0.3% q/q. While increases in real incomes have slowly begun to translate into an uptick in consumption, exports dropped as the industrial sector continued to struggle. Investment activity has remained relatively weak, weighed down by still tight monetary policy, subdued external demand and reduced profit margins. While government consumption and investment continued to support economic activity, fiscal policy more broadly constituted a drag on growth.

EY European Economic Outlook – October 2023

Europe’s economic malaise persists, but recovery is just around the corner

EY European Economic Outlook – July 2023

European economy shows resilience, but recovery will be sluggish.

EY European Economic Outlook – April 2023

European economy shows resilience, yet faces a bumpier recovery path.

Global Economic Outlook for 2023 | A European Perspective

Persistent elevated Inflation has been increasingly weighing on household real incomes, resulting in the cost-of-living crisis and demand destruction. High energy prices also disrupt growth in energy-intensive industrial sectors, e.g. metals, ammonia, chemicals or glass producers. Central bank interest rate hikes have tightened financial conditions and adversely affected private investment. That coupled with heightened uncertainty all weigh on consumer and business sentiment, resulting in economic slowdown, with many economies poised to contract.