Euro area outlook: Recovery delayed, not aborted

The third wave has most of the euro area in its firm grip, forcing governments, to varying degrees, to tightening containment measures again. These measures will inevitably weigh on growth , delaying a genuine pick up of the euro area economy to the start of the summer. We expect some sectors, in particular tourism, to continue to be adversely affected by the pandemic throughout the summer. This will slow the recovery in those countries , where tourism has a relatively high weight , preventing a recovery to pre-crisis level of activity quickly . Nevertheless, the euro area will join in the global upswing this year and we forecast growth of 4.1% this year followed by 3.5% next year.