Across Europe, signs of distress are multiplying as Russia's war in Ukraine drags on.
Food banks in Italy are feeding more people. German officials are turning down the air conditioning as they prepare plans to ration natural gas and restart coal plants.
In the long run, however, economists say Russia, while avoiding complete collapse, will pay a heavy price for the war: deepening economic stagnation through lost investment and lower incomes for its people. It's a critical safeguard for 1,800 member farmers whose 50,000 cows produce a million litres of milk a day. Dairy cows have to be milked daily, and a shutdown would leave that ocean of milk with nowhere to go.
The economic woes also appear at the dinner table. Consumer groups estimate a typical Italian family is spending 681 euros more this year to feed themselves. Her monthly food budget of 150 to 200 euros dropped to 100 euros in June. She said her family doesn't eat as much in summer, but she's concerned about September, when she will have to buy school supplies for her 15-year-old daughter and 8-year-old son, further whittling her budget.
Carsten Brzeski, chief eurozone economist at ING bank, foresees a recession at the end of the year as high prices sap purchasing power. Europe's longer-term economic growth will depend on whether governments tackle the massive investments needed for the transition to an economy based on renewable energy.
Though foreign-owned businesses like IKEA have shuttered and Russia has defaulted on its foreign debt for the first time in over a century, there's no sense of imminent crisis in downtown Moscow. Well-heeled young people still go to restaurants, even if Uniqlo, Victoria's Secret and Zara stores are closed in the seven-story Evropeisky mall.
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