Report
The worst-case scenario for the euro zone: A highly inflationary recession
A highly inflationary recession in the euro zone is of course the worst-case scenario for late 2022 and 2023. This scenario would occur if: Russian natural gas exports to the euro zone all but come to a halt , leading to both a very sharp rise in energy prices and a loss of production; Global oil market pressures continued; Wages caught up significantly to correct the loss of purchasing power in 2022; Fiscal policies remained expansionary. This configuration of a recession with very high inflation is not out of the question and would create a major headache for the ECB.
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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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