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Given the sharp setback in consumer spending in H1 2020, which far exceeded anything seen during the Great Financial Crisis as well as the Eurozone debt crisis, without a meaningful rebound in private consumption, economic recovery prospects will remain rather dim.
The unprecedented fiscal stimulus plans launched by European governments this summer (phase II to relaunch growth engines after phase I emergency relief programs) should help to boost economic growth by +2.4pp in France, +2pp in Germany and +0.7pp in Italy over 2021-22.
The second edition of the “Allianz Pulse”, a survey to check the mood in France, Germany and Italy, reveals deep pessimism: 82% of the French, 77% of the Italian and 49% of the German respondents consider the economic outlook as bad.