Europe's vehicle market is likely to grow in 2014 for the first time in seven years, according to a Korean research institute associated with Hyundai.

The Korea Automotive Research Institute (KARI) said that it forecasts growth of 2.5% in Europe's vehicle market in 2014, taking it to 13.87m units. That compares with a decline of 3.8% to 13.53m units this year.

However, KARI also said that future growth of the vehicle market in Europe would be constrained by high unemployment and the effects of the sovereign debt crisis.

KARI also forecast that higher interest rates in the US would cause US vehicle market growth to slow in 2014. It projects US sales next year at 16.1m units, 3.2% ahead of this year's forecast 15.6m sales.

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