With all the doom and gloom headlines you maybe somewhat surprised to find out there have been huge improvements in budgetary positions in many European nations. More significantly the biggest debtor nations have seen the biggest improvements. Why? Inflation is adding more to revenues than it is to spending, this is reducing debt-to-national-income ratios by both lowering debt and by boosting (nominal) income.
Europe was affected by the Russian gas supply cut; however, it could have been much worse. The milder weather enabled Europe to boost winter reserves. Europe was able to build a working buffer for this winter and sending natural gas and power prices lower. Dutch TTF front-month natural gas futures collapsed over 70% from the highs.
Europe got through the cold season without needing to close parts of its industry by large-scale rationing of gas. Gas consumption was lower than forecast.
This helped budgets tremendously as we can see.
Source: Oxford Economics
From the TradersCommunity Research Desk