Following an impressive H1 2022, total output growth in the Euro Area slowed down considerably in Q3, with total output in the region increasing by merely 0.2 percent compared to previous quarter. Dented business confidence due to supply disruptions and an overall weakening demand, and downbeat consumers are the main reasons behind Europe’s economic downturn at the start of the second half of 2022. Looking forward, a weak Q3 combined with further declines in business activity, record-high inflation and a tighter monetary policy all point to an economy that is unlikely to escape recession in the near future.