00:00Well, this move somewhat expected considering the fact that earlier this week the IMF downgraded their expectations for U.S. economic growth by nearly a whole percentage point for this year and for the global economy by half a percentage point.
00:16So looking at their European expectations, well, for this year, they're expecting economic growth to be 0.8%, 1.2% for 2026. That is a 0.2% downgrade for both this year and next year compared to January's estimates.
00:36As you rightly mention, a major reason for this revision, U.S. tariffs trade tensions globally.
00:45The IMF saying that this leads to more uncertainty, tightening of financial conditions, warning that their downgrade could continue even further should these trade tensions worsen.
00:58Now, important to note that Valdez Dombrowski, the European Commission's trade representative, is in Washington for a meeting with Scott Bessett, the U.S. Treasury Secretary with tariffs, very much expected to be on the agenda.
01:16Addressing that issue at a press conference, the IMF representative stating that they hope these negotiations can be fruitful, saying that more trade essentially means more prosperity.
01:29While Europe is facing plenty of economic headwinds, they did say there are some areas for optimism.
01:37Inflation, for example, they expect to hit the benchmark rate of 2% in the second half of this year.
01:44They're looking at Germany, the EU's largest economy.
01:49They say that public investments in things like infrastructure, things like defence, could yield GDP growth to the tune of around 0.1% this year, 0.2% next year as well.
02:02And when it comes to the sluggish growth we've seen in Europe over recent years, they say that Europe can still be competitive.
02:09But they warn that a major issue is start-ups just don't have conducive conditions here.
02:15And that is why so many, especially in the tech field, start-ups are moving to the United States.
02:21They say that what is required to generate more growth here in Europe is more access to venture capital for these start-ups and brewing industries to succeed.
