Eurozone Recession Seen as Economy Falls to 21-Month Low in April

Source: Sentix

The eurozone economic indicator contracted for the second straight month in April, to fall to its lowest level in nearly two years. EZU is down 0.29%, while VGK is flat premarket.

• The overall Sentix index dropped 11 points to -18, following the -7.0 in March. This is the lowest since July 2020.
• Economists are expected to report the start of the second quarter as the beginning of a recession, likely to be assured by the negative performance.
• The current situation index also fell to negative territory at -5.5, down from 7.8 in March. The expectations index plunged to -29.8 from -20.8 the past month.
• The decline is attributed to the impact of the ongoing conflict between Russia and Ukraine, and the economic sanctions implemented against Moscow.
• Investors do not expect the central bank to implement a looser monetary policy, amid the continuous uptrend in inflation.
• Germany’s indicator fell by 14.8 points to -4.8, a level last seen in March 2021. Expectations also fell to the lowest since January 2009.