The outlook for the euro area remains highly uncertain, shaped by tighter financing conditions, heightened geopolitical tensions, and significant rising risks, such as climate and cyber risks, Governor of the Central Bank (CBC) of Cyprus, Christodoulos Patsalides, said at the Economist 20th Annual Cyprus Summit, adding that Europe is falling behind with much lower productivity levels compared to the United States and worrying that if trade restrictions materialise, the outcome may be "inflationary, recessionary, or worse, stagflationary."