According to Neil Woodford, manager of the UK's biggest equity fund, it appears likely that issues such as the ongoing eurozone debt crisis will weigh heavily on the fiscal wellbeing of the continent as a whole.
Mr Woodford - whose Invesco Perpetual High Income Fund comprises $17.7 billion on assets - stated that the outlook for the European economy has "deteriorated quite significantly" in recent times.
"I do expect the eurozone to be in recession next year and the UK economy could well be following suit," he added.
Furthermore, Mr Woodford explained that the process of bank deleveraging in Europe has now "started in earnest" and this usually translates into a "credit contraction".
This comes after Bloomberg reported that many financiers across the region are using risk-weighted asset optimisation to help meet capital ratio requirements.
By Asim Shah