Eurozone private sector growth almost stalled this month, a key survey showed on Tuesday, adding to evidence that the bloc is already feeling economic fallout from the U.S. and Israeli war with Iran, with inflation rising and growth slowing.
“The economic hit from higher energy prices could be felt very quickly,” Jack Allen-Reynolds at Capital Economics said. “Based on our working assumptions for energy prices, we suspect that the economy will stagnate rather than contract, but there are clearly risks in both directions.”
Interest rates are rising amid expectations of further European Central Bank rate increases to curb inflation, pushing some mortgage rates higher and denting disposable incomes.
Meanwhile, petrol prices have risen by more than 10% across the EU, while diesel is up over 20%. Even if the war ends relatively soon, prices are unlikely to fall quickly, as some energy infrastructure has been damaged and fuel bottlenecks may take several months to resolve.
The S&P Global flash eurozone Composite Purchasing Managers’ Index fell to a 10-month low of 50.5 in March, down from 51.9 in February, as the war drove input costs to their highest in more than three years and triggered the worst supply chain disruptions since mid-2022.
“The flash eurozone PMI is ringing stagflation alarm bells as the war in the Middle East drives prices sharply higher while stifling growth,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.
The fall in the PMI comes as German figures held up relatively well, while other major economies took a bigger hit, including France, where business confidence tumbled.
Separate data released a day earlier showed consumer confidence in the bloc falling to its lowest level since late 2023, marking one of the steepest declines on record and dropping well below its long-term average as economic pressures weigh on households.
Dubai’s most iconic hotel, the Burj Al Arab, is set to close for the first time since opening in 1999 as it begins an extensive 18-month refu...
Armenian Prime Minister Nikol Pashinyan has said that the opening of railway transit routes through Azerbaijan has helped shield Armenia’s ec...
France is set to vote on a controversial law targeting what it calls “new forms” of antisemitism, sparking sharp divisions and raising ...
Hungary’s election winner, Péter Magyar, said on Wednesday his cabinet could be sworn in by mid-May, with Magyar taking office as prim...
A former NATO chief and senior figure the UK's ruling Labour Party has launched a sharp attack on Prime Minister Keir Starmer, accusing hi...
A vast undersea power link across the Black Sea is gaining momentum, strengthening Georgia’s ambitions to become a key energy bridge between East and West.
Hungary’s political landscape is entering a new phase after voters brought an end to the long rule of Prime Minister Viktor Orbán, with analysts pointing to economic discontent and governing fatigue rather than a decisive ideological break.
While a fragile ceasefire in the Iran war may deliver badly needed relief to economies battered by the world’s worst-ever energy crisis, hopes it will quickly restore normal oil and gas flows from the Middle East are almost certainly misplaced.
Lithuania’s Prime Minister’s visit to Azerbaijan on 9 April signals a deepening strategic dialogue between Baku and European partners. Analysts say economic interests and geopolitical shifts are driving closer engagement.
A preliminary round of Lebanon-Israel talks has concluded in Washington, marking a tentative diplomatic step as regional tensions rise. The development comes as the United States launches a naval blockade of Iranian ports.
Greenland’s prime minister has appointed his predecessor to oversee foreign affairs, as pressure from Washington intensifies over the Arctic island’s future.
Spain’s plan to grant legal status to hundreds of thousands of undocumented migrants is facing early resistance, with immigration officers warning they may strike over a lack of preparation and resources.
The U.S. and Iran could resume peace talks over the next couple of days, U.S. President Donald Trump has said. Talks between Israel and Lebanon were held in Washington yesterday. Fuel prices have dropped below $100 a barrel. U.S. blockade on Iranian ports completes first day.
An Indian healthcare provider plans to invest $50 million in diagnostic and pharmaceutical projects in Uzbekistan’s Namangan region, aiming to expand access to advanced medical services between 2026 and 2028.
France is set to vote on a controversial law targeting what it calls “new forms” of antisemitism, sparking sharp divisions and raising concerns over free speech, criticism of Israel and the protection of Jewish communities.
Hungary’s election winner, Péter Magyar, said on Wednesday his cabinet could be sworn in by mid-May, with Magyar taking office as prime minister, and pledged swift action to unlock billions in suspended European Union funding.
A former NATO chief and senior figure the UK's ruling Labour Party has launched a sharp attack on Prime Minister Keir Starmer, accusing his government of failing to adequately fund defence.
Russia has signalled it is ready to increase energy supplies to China, underscoring deepening ties between the two powers ahead of an expected visit by President Vladimir Putin.
Germany has announced an additional €20 million in humanitarian support for Sudan as Berlin hosts a major international conference aimed at raising more than $1 billion to address one of the world’s most severe and increasingly overlooked crises.
You can download the AnewZ application from Play Store and the App Store.
What is your opinion on this topic?
Leave the first comment