: This was supposed to be the comeback year for the world economy following the Covid pandemic.
Many countries are now grappling with cost-of-living crises because wages are not keeping up with inflation, forcing households to make difficult choices in their spending. Germany, Europe’s biggest economy and the most dependent on Russia energy supplies, accounts for €264 billion of that total. Rising interest rates have also hurt consumers and businesses, though US Federal Reserve chairman Jerome Powell signalled last week that the pace of increases could ease “as soon as” December.
Economists expect Germany and another major eurozone economy, Italy, to fall into recession. Britain's economy is already shrinking. Rating agency S&P Global foresees stagnation for the eurozone in 2023.