EU defence spending boosts growth before inflation – CNB
Financial markets buy into defence equities well before government money has been spent, study finds
A new study from the Czech National Bank (CNB) suggests higher defence spending has immediate effects on GDP growth while only spiking inflation two to three years later.
In a research brief published today (July 27), CNB economists Josef Simpartl, Martijn Boermans and Martin Hodula analyse European defence spending since 2022. They find that a 0.12 percentage point increase in military expenditure as a share of GDP boosts growth by approximately 0.5 percentage points within the first year. They
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