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Brexit to have minor negative impact on economic growth in eurozone: think tanks

Xinhua, July 13, 2016 Adjust font size:

The results of Brexit referendum are only to have a slightly negative impact on the forecasts of economic growth in the eurozone, three think tanks said on Tuesday in a joint forecast report.

Economic output in the euro area is expected to increase by 0.4 percent in the third quarter and by just 0.3 percent in the fourth quarter, according to the latest forecast by the Munich-based Ifo Institute, the French Insee Institute, and Italy's Istat Institute.

"Without the referendum, we would have expected growth to remain at around 0.4 percent in the fourth quarter," Atanas Hristov, analyst with Ifo Institute, stated.

"The referendum has significantly increased uncertainty. The short-term negative impact, however, should remain limited, while the medium-term effect will depend heavily on the new agreements reached between Britain and the EU," Hristov added.

The report notes that the annual growth rate for 2016 in the eurozone is expected to be around 1.6 percent. Endit