The European Commission (EC) has downgraded its growth forecast for this year, blaming growing economic uncertainty and trade tensions across the globe.

In its statement last autumn, the organisation had expected GDP to increase by 1.9 per cent, but this has now been cut to 1.4 per cent.

The body warned that a slowdown in global trade volumes has been taking its toll across the bloc, while the threat of a trade war between China and the US as well as the ongoing Brexit issue have also increased uncertainty.

In terms of individual countries, Italy was forecast to grow by only 0.1 per cent this year and also to breach EU rules for its government budget.

Even Germany's growth rate was slashed to 0.5 per cent from a previous prediction of 1.8 per cent due to lower demand for its exports.

The EC warned that any further escalation of trade conflicts could result in major shocks for the European economy.

"Risks to the outlook remain pronounced," said vice-president for the euro and social dialogue Valdis Dombrovskis.