The European economy has prepared for a downturn

At the beginning of this year, the eurozone economy will contract again, writes Bloomberg citing analysts.

Experts of banks including JPMorgan and UBS Group AG worsen their forecasts because of the new coronavirus restrictions. Vaccination delays and trade disruptions due to Brexit could also lead to a decline. Economists are urging us to prepare for the eurozone economy to contract by about four percent in the first three months of 2021.

Previously, they had forecast growth of 1.3 percent. “We expect governments to provide ongoing assistance to the economy and take measures to stimulate demand,” UBS economist Reinhard Kluse said in a report.

Earlier, the head of the European Central Bank (ECB), Christine Lagarde, proposed making the European economic recovery fund perpetual. Its size is 750 billion euros. Initially, they wanted to use the fund as a temporary tool to help EU countries out of the crisis.

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