According to the latest European Economics Update from Capital Economics, the Eurozone economy will begin in Q2 this year but it will not return to its pre-pandemic size until Q2 2022.

Jack Allen-Reynolds at Capital Economics wrote: “Following the recent progress on vaccinations across the Eurozone, we are revising up our GDP forecasts, but it will still lag behind other advanced economies.

“Clearly things could still go wrong, but for now the progress is very encouraging. At the current rate of vaccination, the EU will easily meet its target to deliver first doses to 70% of the adult population by the end of the summer. The Eurozone should get to 50% in June. That’s roughly where the UK was in mid-March around the time it re-opened non-essential shops. If they haven’t opened them already, Eurozone countries will generally re-open shops at lower vaccination levels.”

He added: “Our new working assumption is that most economically-damaging restrictions in the Eurozone will be lifted over the next couple of months. If so, activity should begin to recover rapidly towards the end of Q2, but most of the rebound will still come in the third quarter, by which time the economy will also be boosted by the return of summer tourists.”