With wars and soaring inflation, the IMF warns that Europe is headed for a serious economic recession
New York: The IMF has warned that the Ukraine war and rising inflation will cause a severe economic recession in Europe. The IMF predicts that Germany and Italy will enter a deep recession by next year. According to the report, Europe’s economic growth will slow sharply and inflation will remain high.
In 2023, economic growth will slow to 0.6%.
According to the report, economic growth in Europe’s developed countries will fall to 0.6% in 2023. The report says that the growth of the economies of countries except Turkey will decrease to 1.7%.
Disruptions in energy supply will exacerbate the situation during the winter. Gas shortages and energy rationing are likely. Central banks should continue to raise interest rates. The IMF recommends that advanced economies move faster. According to the report, countries will have to take a difficult path to combat inflation and assist vulnerable households and businesses.
Germany and Italy will be the first to suffer.
Germany and Italy will be in recession the following year. These will be the first advanced economies to contract as a result of the war. The IMF has previously stated that Germany, Europe’s largest economic power, will experience 0.3% growth in 2023. According to the report, Italy’s domestic production, which is heavily reliant on gas imports, will contract by 0.2%.
The energy crisis poses a significant risk to Europe’s economic activity. Some European countries will experience a recession as a result of this. It will eventually affect the entire continent of Europe. According to the IMF, Europe’s social tensions will be exacerbated by the cost-of-living crisis.
Inflation and the energy crisis will make life difficult for people.
Families will suffer as inflation rises and the energy crisis worsens. This reduces their purchasing power. At the same time, costs for business establishments will continue to rise. Government assistance cannot solve these issues entirely. According to the IMF’s Regional Economic Outlook report, this situation will plunge Europe into a deep economic recession. The European Central Bank had to raise interest rates in order to address issues such as price inflation.
Irish Samachar English News
Kindly click the link below to join WhatsApp group chat to get important news and breaking news from Irish Samachar.
Comments are closed.