The European Commission’s forecast for growth in the eurozone leading economies remains under 3% as the unemployment rate falls and public finances are under firm control.

"The moderate evolution of wage growth combined with good productivity growth suggests that unemployment should remain low and stable at around its current level throughout the next two years," the commission said.

The budget deficit is estimated to approach 3% this year and 2.75% in 2006 in the UK, according to the commision. Its national debt is forecast at 40% of GDP (national output).

The nation’s consumer spending is expected to grow 2.25%.

Joaquin Almunia, the economic and monetary affairs commissioner, said the economy’s recovery would gain momentum amid rising employment.