Mubasher: Bank of America Merrill Lynch (BAML) lowered its projection for the Eurozone economic growth for this year, citing uncertainty over trade policy and weak Chinese data.

Bank of America expects the Eurozone to grow at 1.1% this year, compared with the earlier forecast of 1.4%.

“The euro area is facing a triple whammy of FX appreciation, foreign demand weakness [in China] and trade policy uncertainty,” US lender’s economists said in a note, noting their growth forecast was now below market consensus.

Trade policy uncertainty is already taking a heavy toll on the Eurozone growth, slashing the rate by 15 basis points (bps), the economists estimated.

In addition, US tariffs on vehicles imported from the European Union (EU) could cost additional 30 bps of growth deterioration.

Last week, the bank lowered its inflation forecast for the Eurozone to 1% owing to a drop in oil prices.

The EU statistical office, Eurostat on Thursday said that the Eurozone annual inflation for retreated to 1.6% last December, from 1.9% in the prior month.