Europe’s crisis-hit banks could topple the entire WORLD economy
SOME of Europe’s biggest banks are a key risk to the world economy, with Italian firms posing the biggest worry, a top think tank has warned.
By LANA CLEMENTS
Express.co.uk
Wed, Aug 3, 2016
Growth of the global economy been revised down for next year to 3.3 per cent from 3.5 per cent by the National Institute of Economic and Social Research (NIESR).
The outlook for the eurozone has taken the largest hit, following Britain’s vote to leave the European Union (EU), the institute said.
Italy’s banking system is particularly weak and is now looking even more fragile, the think tank said.
And the crisis threatens the eurozone’s governing of financial firms across the bloc which could end up in an increasingly fragmented – or balkanised – system, according to NIESR.
Europe’s economy growth has now been shaved by 0.4 per cent by the think tank.
Dr Angus Armstrong, director of macroeconomics at NIESR, said: “Balkanisation of EU finance comes at a time of financial fragility in the Eurozone banking system.
“This has added to the financial pressure on some of the largest European banks and the whole banking sector in Italy.
“As a consequence, growth in the Eurozone is revised down from 1.7 to 1.3 per cent in 2017.”
It comes as experts warn contagion from Italy could easily spread through the banks in Europe.
The Rest…HERE
