Russia’s unjustified war in Ukraine has sharply deteriorated the European economic outlook for 2022 and 2023. Soaring energy prices pushing overall inflation to double digits, plummeted consumer confidence, and dented business activity amid reduced demand are likely to tip the Euro Area economy into recession by the end of 2022. More recently, the ECB’s decision to tighten its monetary policy has increased downside risks to the region’s growth prospects.