Retail sector leads surge in corporate distress across Europe
According to a report by the Weil European Distress Index (WEDI), corporate distress across Europe surged in Q2 2026, with the retail and consumer sectors experiencing the sharpest rise since the global financial crisis. Weak consumer confidence, reduced discretionary spending, and higher operating costs are squeezing profitability, liquidity, and investment. The industrial segment is the next most distressed, facing subdued demand and energy cost uncertainty. Geopolitical instability, including the Middle East conflict and the Iran situation, compounds pressures. Germany recorded the highest national distress, followed by France and the UK, while Spain and Italy remain relatively resilient. The IMF has downgraded Euro Area GDP growth forecasts for 2026 to 1.1%, indicating persistent difficult conditions.
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