FXStreet notes that conditions on the European Continent have taken a sharp turn for the worse in recent weeks. Therefore, action from the European Central Bank will be needed, in the opinion of analysts at Westpac Institutional Bank.

“It is now our expectation that the Euro Area economy will fall into recession in the first half of 2020.” 

“External demand contracted through 2019 and now faces an additional headwind from supply disruptions and weaker growth.” 

“Domestic demand is set to weaken materially, principally as a result of consumption, investment and services exports.”

“The ECB will be forced to act but has limited scope to aid growth.”