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Eurozone recession "inevitable" in 2012
04 January 2012
Economists predict a eurozone recession this year while US growth could be rocked by politicians’ failures to reach agreements on budget cuts. Stephanie Baxter reports
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Patrick Zwiefel
Tim Drayson
Pictet Asset Management
Legal and General Investment Management
Europe-wide recession in 2012 is inevitable with Italy being the biggest eurozone loser in terms of growth, according to economists.
Negative predictions for the next 12 months are making the headlines as discussions over EU treaty change repeatedly failed in November and December.
Economists are saying that the damage from the eurozone crisis has already been done and that the situation may have to deteriorate even further to prompt effective action.
Patrick Zwiefel, chief economist at Pictet Asset Management, says the eurozone will see a recession in 2012 but that Germany could be excluded:
“The eurozone will enter a recession in the fourth quarter of 2012 and growth will be barely positive throughout the year. However, Germany is extremely likely to avoid a recession.”
Tim Drayson, economist at Legal and General Investment Management, agrees that a recession seems inevitable but that Germany is “vulnerable”.
He goes on to say that...
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