Eurozone Economy On The Verge Of Deeper Crisis, Sentix Says

RTTNews | 1 day ago

(RTTNews) - The euro area economy is in the danger of plunging even deeper into crisis and the room for the European Central Bank for maneuver is diminishing rapidly, the behavioral research institute Sentix said Monday.

Eurozone investor confidence sunk to the lowest level since November 2023 with the corresponding index falling to -17.7 in January from -17.5 in December, results of the monthly survey by Sentix revealed. The reading was in line with expectations.

The situation assessment declined significantly to the worst value since October 2022. The current situation index slid to -29.5 from -28.5 in December.

By contrast, the expectations index rose to -5.0 in January from -5.8 in December.

"The economic engine is in danger of being stalled further," Sentix said.

Further, the think tank observed that the ECB's room for maneuver is rapidly diminishing. This is because the inflation trend is on a negative trajectory and the governments are firing on all cylinders over high deficits.

"2025 is off to an extremely challenging start," added Sentix.

Germany's recessionary economy is hanging like a lead weight on the eurozone, said Sentix. The think tank observed that the German economy is in a recession and it will not be able to emerge from it anytime soon.

The investor confidence index dropped marginally to -33.3 in January from -33.2 in the previous month.

At -50.8, the current situation indicator was unchanged from December. The expectations index slid to -13.8 in January from -13.5 in the previous month.

Tags: EUR

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