Investor morale in the euro zone fell this month to its lowest level since May 2020, pointing to an “inevitable” recession in the 19-country currency bloc, a survey showed on Monday.
Sentix’s index for the euro zone fell to -26.4 from -15.8 in June.
“The energy crisis … is leading to considerable economic distortions,” Sentix Managing Director Manfred Huebner said in a statement.
“In every respect, the dynamics are reminiscent of the crisis year 2008, and what was then the collapse of the financial system is now the danger of the collapse of the European energy supply,” he added.
Germany, Europe’s largest economy, moved last month to stage two of its three-tier emergency gas plan after Russia reduced deliveries via the Nord Stream 1 pipeline – a step before the government rations fuel consumption.
A Sentix index on the current situation in the euro zone fell to its lowest since March 2021, and an expectations index dropped to its lowest since December 2008.
“Situation scores like the current one justify the expectation that a recession is inevitable,” Huebner added.