Omicron dents euro zone’s economic rebound; inflation at record high – Reuters

Omicron dents euro zone’s economic rebound; inflation at record high – Reuters

FRANKFURT, Jan 7 (Reuters) - Euro zone economic sentiment dropped more than expected last month while inflation hit another record high, indicating the economy is under renewed stress as surging coronavirus infections force governments to tighten restrictions.

With infections breaking records almost daily as the Omicron variant sweeps across Europe, growth is likely to take a hit around the turn of the year even though governments have largely avoided the debilitating measures that brought their economies to a standstill a year ago.

Foreshadowing the pain, the European Commission's Economic Sentiment Indicator, a key gauge of the bloc's economic health, fell more sharply than forecast in December to a level last seen in May. The outlook for services worsened significantly and employment expectations also fell. read more