FT News Briefing European double-dip recession concerns, Sunak dangles lockdown money, Brexit market
Oct 19, 2020
Concerns grow over Europe potentially facing a double-dip recession as rising COVID-19 cases prompt new restrictions. UK Chancellor Rishi Sunak is poised to offer significant funds to resolve the impasse with Manchester leaders over lockdown measures. Meanwhile, investors are scrutinizing sterling's fluctuations as Brexit's end approaches, with discussions on its effects on markets and the FTSE 100's performance. Economic forecasts are becoming increasingly bleak as governments confront mounting budget deficits amidst these challenges.
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Double-Dip Recession Concerns in Europe
- Europe is facing a second wave of COVID-19, leading to renewed restrictions.
- This raises concerns about a double-dip recession, as fragile consumer confidence and potential business investment slowdowns could hinder economic recovery.
European Governments' Budgetary Shortfalls
- European governments face unprecedented recession and have implemented emergency spending measures.
- Budget deficits are projected to reach nearly one trillion euros this year and 700 billion euros next year.
Why a Double-Dip Recession?
- Despite fiscal and monetary policies, the resurgence of the virus necessitates new restrictions.
- These restrictions, even if less severe than previous lockdowns, impact consumer confidence and business investment, increasing the risk of a double-dip recession.