Eurozone “dangerously close to stagnation” after Brexit

The UK’s decision to leave the EU has left economic sentiment among investors at the lowest level since July 2014, according to a poll that included the views of 260 people in institutional investment.

Sentix, a German-based research group that carried out the poll, warned that the Eurozone was “dangerously close to stagnation” as Brexit is expected to hit both the economic bloc and the Swiss economy the hardest.

A Sentix index of investor sentiment, which is based on the poll results, moved from 12 points in June, to -2 points in July after the referendum result. The firm said the UK referendum had hurt investor expectations for Eurozone.

Political risks stemming from the Brexit were “a heavy burden” for the “already battered” Eurozone, said Sentix, adding: “The single-currency zone has yet to prove its resilience to cope quickly with such a blow to the European project.

The probability of a euro-break up has increased, claims the firm, which polled 1,056 investors for its research, including the 260 institutional investors.

©2016 funds europe

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