Is the eurozone about to plunge into a recession?

A reforming prime minister has been ousted by a fractious, divided parliament. The central bank is raising interest rates to try and stem inflation that is running out of control. Everyone is being urged to use as little electricity as possible as officials scramble around to secure enough energy, and the currency is crumbling as the economy turns down. It would, in fairness, be a reasonable description of a chaotic and struggling Brexit Britain. As it happens, however, it is a summary of the EU and the euro-zone as it stumbles towards its next crisis.

It is turning into a terrible summer for the eurozone. The eurozone’s purchasing managers’ index (PMI) has slumped from 52.0 in June to 49.4 in July, suggesting the bloc could be on the brink of a recession. Meanwhile, in Italy, Mario Draghi, the technocratic former president of the European Central Bank has resigned as prime minister, a move that will trigger fresh elections and possibly lead to a populist far-right government.