Eurobank – Pandemic and energy crisis create downside risks for the 4th quarter 2021

The recovery continued in the third quarter of 2021, however the resurgence of the pandemic and the energy crisis pose downside risks for the fourth quarter of 2021 and jeopardize the disposable income of households.

This is the main conclusion of Eurobank's weekly study "7 DAYS ECONOMY".

According to the bank, the energy crisis and inflationary pressures pose declining risks to production, especially in industry, and real disposable household income in the 4th quarter of 2021. Added to this is the current resurgence of the pandemic, the intensity of which does not seem to have been expected.

According to preliminary estimates of the national accounts for the third quarter of 2021 (source: Eurostat), real GDP in the Eurozone strengthened on a quarterly basis by 2.2%, marginally higher than in the previous quarter (2.1%), according to the bank. The annual real growth rate was 3.7%, much lower compared to the 2nd quarter of 2021 (14.2%) due to the elimination of the positive base effect of the 2nd quarter of 2020. Undoubtedly, the period April-May 2020, ie the period implementation of the first round of restrictive measures, was the bottom of the COVID-19 pandemic economic cycle. Most macroeconomic performance - in qualitative terms - with that of the Eurozone has been shown by most EU-27 countries for which data are available. Indicatively, the annual change in real GDP in Belgium slowed to 4.7% in the third quarter of 2021 from 15.1% in the second quarter of 2021, in Spain from 17.5% to 2.7%, in France from 18.8% at 3.3%, in Italy from 17.0% to 3.8%, in Austria from 12.6% to 4.8% and in Portugal from 16.1% to 4.2%.

The recovery

The national accounts of Greece for the 3rd quarter of 2021 are scheduled to be published on December 6,...