Report
Euro zone: A tax on young people, amounting to 10% of GDP, is being prepared
If euro-zone GDP declines by around 8.5% this year, the loss of GDP caused by the COVID crisis will be around 10%. This loss of income cannot disappear, but where will it appear? Euro-zone countries have run up massive fiscal deficits, which will be fully monetised by the ECB at least until mid-2021. As a result, we can expect a very rapid rise in the prices of financial and real estate assets as the liquidity created is being invested in these assets. The loss of income of 10% of GDP in 2020 will therefore appear in a particular form: a taxation of 10% of GDP on young people in the form of a rise in the prices of the assets they have to buy, to build up savings or for housing.
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Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
Patrick Artus
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