One of the U.K.’s largest asset managers has warned that the continued focus on austerity in Europe could lead to “almost endless depression” for the region.
The comments come as George Soros and the U.S. Treasury Secretary Jack Lew have urged Europe’s leaders to do more to boost growth after Portugal’s top court rejected some of the country’s austerity measures, on which its bailout depends.
“The prospects for GDP [gross domestic product] recovery in the euro zone in 2013 or 2014 are diminishing by the month,” John Greenwood, chief economist at U.K. asset manager Invesco Perpetual wrote in his quarterly outlook on Tuesday.
“My forecast is for real GDP growth of -0.2 percent, compared with an estimated -0.5 percent in 2012. In short, there will be no meaningful recovery in 2013, and there is a risk of the downturn extending into 2014.”
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