Eurozone CRISIS: Euro area growth forecast to SLOW as global economies 'in BLEAK outlook'

Growth is also predicted to be “moderate” in the UK, while the IMF claims economic conditions worldwide have been stunted by political tensions, trade wars, oil prices and tighter financial conditions.

The IMF said in its latest Regional Economic Outlook report for Middle East and Central Asia: “Real GDP in the Euro area will slow to 1.9 percent in 2019, compared to 2.9 percent in 2018.

“Growth will also moderate in the United Kingdom, following surprises that suppressed activity in early 2018.”

According to a flash composite purchasing managers’ index (PMI) from IHS Markit, eurozone growth skidded to its slowest rate in more than two years in October.

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It cited the main reasons as escalating US-China trade war fears and an ongoing row between Italy and EU chiefs over Rome’s budget.

Italy’s financial statement left EU chiefs furious after it included a deficit budget of 2.4 percent of GDP – three times the previous administration’s target.

The data, released last month, showed eurozone PMI slowed to 52.7, down from 54.1 in September and marking the slowest level of growth recorded in 25 months.

The ECB left interest rates at a record low in October as the central bank confirmed plans to stay on course to claw back stimulus.

Eurozone growth is forecast to slow, according to the International Monetary Fund (Image: GETTY)Real GDP in the euro area is forecast to slow to 1.9 percent in 2019 (Image: GETTY)

Sticking to a guidance first unveiled in June and repeated at every meeting since, the group reaffirmed its €2.6 trillion ($2.97 trillion) asset purchase scheme will end this year and rates could rise after next summer.

The ECB said in a statement: ”The Governing Council expects the key ECB interest rates to remain at their present levels at least through the summer of 2019.”

Meanwhile, the IMF described how “global financial conditions have started to tighten” as they blamed higher US interest rates, a stronger US dollar, and financial market volatility for hammering emerging markets and developing economies.

In the US, GDP growth outlook remained the same for 2018 at 2.9 percent, but has been downgraded to 2.5 percent in 2019 due to the deepening trade war with Beijing.

Washington has so far slapped $250bllion (£190.4billion) of tariffs on Chinese products.

In an act of retaliation, China responded with 10 percent tariffs on $60 billion (£46 billion) of US imports.

The sanctions have proved detrimental to China’s projected growth, which has steadily decreased from 6.9 percent forecast growth in 2017, to the 6.2 forecast in 2019.

However, there was a more positive outlook for the Middle East, with the IMF predicting main oil exporters will see strengthened economic activity this year and next.

The areas singled out include the Middle East, North Africa, Afghanistan and Pakistan.

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