EU raises economic growth outlook, but warns of "uncertainty"

Growth in the 19-country eurozone and the wider European Union (EU) was projected on Thursday to pick up this year, but there were again warnings of uncertainty including Brexit and the trade policy of the United States.

The gross domestic product (GDP) across the single currency zone is expected to expand by 1.7 percent in 2017, said the European Commission in its spring economic forecast, up from the 1.6 percent in the winter forecast released three months ago.

For the 28-country EU, the estimated GDP growth for this year was nudged up from 1.8 percent to 1.9 percent, said the EU

The bloc's brighter outlook came alongside better global environment as many advanced and emerging economies started to see momentum.

"The global economy gathered momentum late last year and early this year," said the commission, adding that the economy of China, the bloc's second largest trade partner, "remains resilient in the near term."

"Europe is entering its fifth consecutive year of growth," said Pierre Moscovici, EU Commissioner for economic and financial affairs, taxation and customs. Moscovici said that "the high uncertainty that has characterised the past 12 months may be starting to ease." But the EU official warned that the level of uncertainty remained "elevated."

For the commission, risks for the bloc's economic outlook lay in both inside and outside. Internal factors include the health of banking sector in Europe as well as the forthcoming divorce negotiations with the United Kingdom.

Future U.S. economic and trade policy and broader geopolitical tensions could pose external risks, according to the commission.

Overall, risks had become more balanced than in the winter but they remained tilted to the downside, it said. Endit