BRUXELLES – European Economy Commissioner Paolo Gentiloni said on Friday that the outlook for next year has “seriously worsened,” and that most European Union (EU) countries will be in recession in the fourth quarter of this year.
Gentiloni believes the EU economy has reached a “tipping point.”
He was speaking at a press conference in Brussels just after the European Commission revealed a reduction in its economic growth prediction for next year.
According to the European Commission’s autumn projection, economic output will fall in the last three months of this year and the first three months of 2023.
Uncertainty, high energy price pressures, eroding household spending power, a deteriorating external environment, and tighter financing conditions are likely to push the EU, eurozone, and most member countries into recession in the fourth quarter of 2022.
The prediction for real GDP growth in the EU and eurozone in 2023 as a whole is 0.3 percent, far below the 1.5 percent and 1.4 percent projected in the previous July forecast.
“The spike in energy prices and rampant inflation are now taking over, and we are in for a really tough moment, both socially and economically,” Gentiloni said.
“After a fairly strong first half of the year,” he added, “the EU economy lost impetus in the third quarter, and current poll data indicate to a winter decline.”
Furthermore, inflation has continuing to climb faster than anticipated.
Price pressures have accelerated and broadened in the first ten months of the year, pushing the predicted inflation peak to the fourth quarter of this year and raising the yearly inflation rate prediction to 9.3 percent in the EU and 8.5 percent in the eurozone.
Inflation is predicted to fall in 2023, but to remain high in the EU at 7.0 percent and 6.1 percent in the eurozone.
Source: Xinhua News