Europe could be headed for a period of stagflation as governments struggle to reform their fiscal policies and growth weakens, investor Wilbur Ross told CNBC.
Debt will continue to hurt economies in the PIIGS nations—Portugal, Italy, Ireland, Greece and Spain—and contribute to a pattern of higher unemployment coupled with high inflation, said Ross, chairman of the W.L. Ross private equity firm.
The countries face a future of European Union and International Monetary Fund bailouts that will be accompanied by strict austerity measures.