World Bank Chief: Weak Euro And High Inflation Raise Risk Of Recession In Europe

According to David Malpass, the head of the World Bank, a recession in Europe becomes more likely as a result of the weak euro and high inflation.

Speaking at Stanford University, Malpass stated that « the euro’s weakening and rising inflation raise the risk of a recession in Europe. » He added that the World Bank sees risks in temporarily slowing down Europe’s economic growth.

Christine Lagarde, president of the European Central Bank, stated on Monday that the fourth quarter of 2022 and first quarters of 2023 are expected to see a decline in the GDP of the euro zone. Lagarde noted that the ECB’s baseline scenario anticipates 0.9% growth in the eurozone’s GDP in 2019 while the worst-case scenario, some of which have already come to pass since its inception, predicts a 0.9% recession.

David Malpass cautioned that it will take time to wean the world’s energy production from Russian supply.

source: worldbank.org

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