The European Commission said Monday that it expects the combined gross domestic product of the 20 countries that share the euro to rise 0.9% this year and 1.4% in 2026, as U.S. tariffs hit exports. It had previously forecast expansions of 1.

The euro zone economy will grow more slowly this year and next because of the trade war started by the United States and uncertainty over when and how it will end, the European Commission said on Monday.

European stocks have outperformed U.S. markets this year amid the turmoil caused by President Donald Trump’s tariff threats. That might still continue despite the European Union lowering its growth forecast Monday in the face of levies.

European Commission warned a further rise in tariffs would inflict more damage on the bloc’s economy but also that increased spending on defense could lift activity.

Euro-area inflation will fall below the European Central Bank’s target next year because of fallout from US trade policies, according to the European Commission.

Popular social media app TikTok has been charged by the European Commission with breaching EU online content rules, which marks the second formal proceeding from the commission since November of 2024.

The third component of the deal was a youth-mobility (now renamed “youth-experience”) agreement. This will make it easier for young people to move, study and work across borders. Britain is to explore how and when it might rejoin the Erasmus-plus student-exchange programme.

The Commission is found to have wrongly refused to publish texts from its president during the Covid pandemic.

Cross-border power links need to be beefed up, Lisbon says after huge blackout, calling it a European Single Market issue.