The Ukrainian crisis has already led to an increase in inflation in Europe. And the negative consequences of the conflict in Ukraine for Europe will double in one to two years. This is reported by the Swiss National Bank.
“The negative effects of the war are likely to have a greater impact in the medium to long term. In one to two years, the effect [of the consequences of the conflict in Ukraine] is likely to be about twice as large,” the regulator said.
The bank’s study looked at the impact of the conflict on the economies of Germany, the UK, France, Italy and Switzerland. According to the regulator, without the conflict by the end of 2022, inflation in Europe would be lower by 0.2-0.4 per cent and GDP would be higher by 0.1-0.8 per cent. The Swiss National Bank believes that the negative effects are already being felt now.
The fighting, in particular, has hit the economies of Germany and the UK hard, where GDP could have been 0.7 per cent higher by the end of last year.
Earlier, the European Central Bank (ECB) significantly reduced the forecast of economic growth in Europe, specifying that the eurozone GDP will grow by 0.7 per cent in 2023, 1 per cent in 2024 and 1.5 per cent in 2025.