Effective policy action helped steer Europe through a strong post-pandemic rebound, though the recovery is now moderating as the region faces renewed headwinds. At the International Monetary Fund (IMF) 2025 Annual Meeting, Alfred Kammer, Director of the IMF’s European Department, cautioned that the region is transitioning into a period of weaker medium-term growth.

As the recovery slows, policymakers are advised to turn their attention from managing near-term momentum to consolidating policy gains. This recommendation comes against the backdrop of the euro area and European Central Bank’s success in bringing inflation under control, which has helped stabilize the monetary environment.