The Eurozone is no longer immune to two consecutive quarters of economic decline. The latest Bloomberg forecasts are not optimistic. According to the American agency, the risk of recession in Europe continues to grow.

Cohen de Leus, chief economist at BNP Paribas Fortis, agrees: “I don’t think we will contract this quarter because we had positive months in July and August, thanks to tourism.”

While De Leus says he is not concerned about the current period, he warns of possible cuts in the coming months. “For the first quarter of 2023, we are going to shrink the economy. It will not be very strong, we are talking about 0.3% or 0.4%, it is not much,” he said.

Excessive inflationary optimism has received a high price

Another problem is inflation. According to Bloomberg estimates, many expect inflation to reach 9.6% in the final three months of the year. This exceeded the target set by the European Central Bank (ECB) five times. For Cohen De Leus, this inflation is, above all, a closed circle.

Shortage risk

In this situation, a possible shortage of gas is a cause for concern. Germany, Europe’s largest economy, is likely to face this challenge. In case of rationalization, Belgium and other European countries such as Italy may be affected.

“Since Germany imports 40% of Russian gas, there is a risk of a shortage. Some companies will reduce production or temporarily close their doors. Therefore, there is a risk of a shortage of certain goods produced by German companies in Belgium. “, – notes Cohen De Leus, quoted by L’Echo and Rador.

Photo: Dreamtime