Central banks were as good as their word in July, with significant rate hikes from the Federal Reserve and Bank of England. In seeking to tackle persistent and rising inflation, policymakers have been forced to look through worsening economic data. The US is already in a technical recession after two quarters of negative growth and the Bank of England predicts that the UK’s economy will weaken significantly in the fourth quarter.   Financial markets have managed to shrug off the recent run of bad news. There are signs that investors may have started to anticipate some moderation in future rate rises as the economic data turns. However, central banks continue to show their resolve and, as yet, there is no apparent peak in inflation.  Europe has been in the eye of the storm on the global energy crisis and faces a series of risks in the months ahead. Should energy supplies fail, it could bring considerable pain for industry and consumers. How bad could it get for the Eurozone economy in the second half of the year?