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October 19, 2020

Bad! European Economy In Danger

 Following a surge in coronavirus cases, resulting in more new sanctions, economists warn that Europe is at risk of a double-dip recession.

Millions of people in Europe are now facing stricter new coronavirus restrictions in the government's latest effort to slow down the surge in cases after the World Health Organization (WHO) reported a staggering increase of 44% in just one week.

Germany, France, the UK, Italy, Spain and the Netherlands have announced new sanctions measures with more expected to be implemented in the next few days.

Meanwhile on Sunday, Belgium announced the closure of all bars and cafes for four weeks, while Switzerland issued instructions on the use of face masks. France enforced curfews at night in Paris and other cities starting Saturday.

An economist from the German multinational financial services company, Allianz, expressed his disbelief in how fast the second wave hit the continent, adding that some countries are now seen experiencing negative growth in the fourth quarter.

In addition, the head of economics from G + Economics is of the opinion that the resurgence of the virus has led to the closure of businesses as well as the collapse of confidence making the recession double the main scenario, besides adding that Brexit disruption will exacerbate the economic downturn.

These forecasts are certainly bad news for the European Central Bank (ECB), which just last month predicted fourth quarter growth of more than 3%. Another setback would affect the ECB's forecast that the European Zone economy will return to pre-Covid-19 levels by 2022.