By Ovunc Kutlu
ANKARA (AA) - Weaker euro area gross domestic product (GDP) growth prospects will slow fiscal recovery from the coronavirus pandemic in the bloc, Fitch Ratings said Wednesday.
Due to Europe's high exposure to energy prices, especially natural gas, Fitch said it expects a significant effect on inflation and income.
The agency said it lowered its growth forecast for the euro area by 1.5 percentage points to 3% for 2022.
Stressing that Germany and Italy have especially high exposure to Russian energy, the agency cut those countries' economic growth forecasts by 1.9 and 1.6 percentage points, respectively.
It also revised the euro area inflation forecast to 5% for 2022, up from a previous estimate of 2.6% made in December, as a result of energy prices rising more than 30% and food prices climbing.