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Capital Economics: Recession still expected in euro zone

Holly by Holly
03/08/2023
in EUR, News
Euro/dollar heading towards parity as ECB continues to tighten policy
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Franziska Palmas, an economist at Capital Economics, wrote in a note that the euro zone still looks likely to slip into recession later this year.

She noted that the euro zone’s purchasing managers’ index fell in July, in line with a small decline in GDP.

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The data confirmed a tight labor market and strong price pressures in the services sector, which could prompt the ECB to raise interest rates further next month.

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“We still expect the euro zone economy to slip into recession in the second half of 2023.”

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Tags: interest ratesisk
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