The expensive lifestyle of Europe is increasing the problems of the people. The position of the European Central Bank is continuously deteriorating due to inflation.
The effect of the economic slowdown in Europe is now starting to affect people’s lives. Due to the expensive lifestyle (Cost of Living Crisis), the economic situation there has started staggering. Due to the ever-increasing economic crisis, people’s expenses are now getting affected. This has been revealed in a survey conducted on Monday. Gas prices in Europe are skyrocketing. The entire region is facing severe drought. The prices of goods are increasing continuously.
According to a report by Reuters, inflation in European countries may touch its highest level in the coming days. It is feared that the cost of running households and other industries in general may increase so much that people can raise their hands.
How many people of European countries were affected by the recession?
Growth in European industries is very low but prices of goods are at the highest level. This slowdown is coming because of inflation. The steps being taken by the European Central Bank are so inadequate that people are not getting relief. A total of 340 million people of the Eurozone are being affected due to this bank.
The situation is not being handled by the European Central Bank,
such situations are being created that the credibility of the European Central Bank is being questioned. Due to this, the difficulties of countries fighting inflation can increase further. It can have a very adverse effect on people’s lives. The policies of European countries are very strict, due to which the situation here is not going to be stable. Due to the costly decline in growth, the crisis of recession will deepen.
Controlling inflation is the biggest challenge of European countries
The biggest challenge before the great leaders of Europe is how to reduce the rate of inflation. The first priority of European countries is also to hold several level meetings in the coming days so that loan charges for homes and firms, house tax and deepening financial crisis can be overcome.
Wednesday’s inflation figures are clearly indicating that there may be unexpected changes in the figures next week. This rate may increase further. Loan costs have increased in Europe. This is adding to the difficulties of the borrowers. Most economists polled by a Reuters poll have said that the European Central Bank could see a 75 basis point rate hike this week. In many forecasts, it has been said that up to 50 basis point rate increase can be seen.
19 countries of Europe coming under recession
A total of 19 countries of Europe recognize the Euro currency. In August, inflation in the euro currency rose to 9.1 percent. Earlier this rate was 8.9 percent. Due to rising inflation figures, pressure on many countries is increasing.
Economist Christoph Weil of Commerzbank has feared that the rate of inflation may increase further in September. Due to rising inflation, the interest rates of the European Central Bank may increase further. This is going to have a bad effect on the lives of Europeans.
Which sectors will be affected by the recession?
Food and energy sector prices in Europe will continue to rise. The service cost is increasing in an uncontrollable manner. There is a fear that the inflation rate may increase further by 5 percent. The European Central Bank’s policy makers are also very concerned about the prices of non-energy industrial goods. The continuous increase in prices along with the products is the biggest concern of Europe. The effect of inflation is enough to shake the economy of Europe.
Inflation excluding food and petroleum rose to 5.5 per cent from 5.1 per cent. Next week the European Central Bank will increase by 75 basis points. The rate of economic growth does not seem to be recovering yet.
Why is Europe’s recession increasing concern?
The coming few months are going to be very worrying for Europe. There is a fear of the economy going down continuously. The rate of energy cost will be higher. The effect on people can be such that people can do it by buying essential things too. The slowdown can also have an impact on the service sector.
The recession is also going to have an impact on the industries. Energy intensive sectors may reduce their production. Due to this the supply of essential goods can be reduced. Here too rising inflation is responsible for this.
Demand for industrial products will decrease
Due to rising inflation, the demand for the products may decrease. The rate of growth seems to be falling continuously. The economic crisis may continue for the euro zone. The European Union is hoping that the slowdown can be prevented through an energy price cap, but its situation cannot be controlled. Policy makers need to go further to deal with the storm of recession.
Work force shortage is also a big problem in Europe. Some experts claim that this is only for a short time. It will not take long for Europe to recover from this situation. When wages increase, the demand for better payment for wages also increases. At present, there is no such situation that industrial units can pay more to the workers. This is also believed to be one of the reasons for the decline in the work force. The European Central Bank is hopeful that inflation and recession will soon be under control. There will be an improvement in the labor market, due to which the economic situation will improve.
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