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Economic outlook 2024: Europe
Mastercard Economic Institute

Economic Outlook 2024: Europe

Published: February 06, 2024 | Updated: May 17, 2024

Read time: 3 minutes

In 2024, consumers and businesses around the globe will make difficult decisions about how to spend and invest, according to the Mastercard Economic Institute’s Economic Outlook 2024 report.

Resources will be carefully prioritized as interest rates, wages and prices remain high relative to pre-pandemic levels. However, moderating inflation, steady real economic growth and varied regional dynamics will sustain consumer empowerment.

Here’s how the dynamics are playing out in Europe.

 

Important takeaways for Europe in 2024:

Headwinds & tailwinds to watch

Headwinds_Europe
2024 headwinds:
  • High interest rates and tighter fiscal policy will likely prevent a more meaningful rebound. 
  • High interest rates will likely force more affluent consumers to prioritize higher mortgage payments over discretionary spending. 
  • The services industry faces capacity constraints and higher prices.
Tailwinds_Europe
2024 tailwinds:
  • Consumer purchasing power will rise as wage growth outpaces inflation. 
  • The manufacturing sector will likely benefit from higher demand for goods, greater disinflation relative to services, a more favorable inventory cycle and a lower drag from high energy prices and interest rates. 
  • The services sector will continue to benefit from strong demand for experiences.

Country breakdown

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