LONDON (Reuters) – Analysts at Barclays have warned of a 5 percentage point hit to euro zone GDP and dive below dollar parity for the euro if Russia closes its gas taps as part the escalating war in Ukraine.
“If Russia closes its gas taps (to Europe), we expect EURUSD to fall below parity,” Barclays said in a note on the rising tensions.
“Our economists estimate that a total loss of Russian supplies, combined with rationing of the remainder, could dent euro area GDP by more than 5 percentage points over one year”.
Pressure on Europe to secure alternative gas supplies increased on Thursday as Moscow imposed sanctions on European subsidiaries of state-owned Gazprom a day after Ukraine stopped a major gas transit route.
(Reporting by Marc Jones; editing by Dhara Ranasinghe)
