How big a deal is the Ukraine crisis for the euro-zone?

A Russian military invasion of Ukraine would adversely affect the euro-zone economy by further disrupting the market for energy, pushing up inflation and reducing households’ real incomes. However, any economic fallout would probably be fairly small and short-lived and other factors, not least the course of the pandemic, will continue to have much more influence on the economy. In view of the wider interest, we are also sending this European Economics Update to clients of our Energy Service.