The world’s desire for a recession, rising interest rates and forced labor have worsened the situation

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The review said that the period of recession may be short and its effect may also be slightly smaller in large countries, but such a quick recovery from inflation. Inflation is expected to remain higher than expected.

The world's desire for a recession, rising interest rates and forced labor have worsened the situation

The threat of recession hangs over the world

The global economy is heading into recession. Indications of this were found in a Reuters survey. The largest economies in the world in the survey growth rate shows a decrease compared to the previous period. On the other hand, central banks are constantly raising interest rates to bring down high inflation. Its worst impact is on growth rates. Some countries have entered recession or are rapidly moving towards recession because the employment rate is considered to be very low. A Reuters poll showed that the gap between growth and unemployment could be the lowest in four decades.

The review said that the period of recession may be short and its effect may also be slightly smaller in large countries, but such a quick recovery from inflation. Inflation is expected to remain higher than expected. The world’s central banks are raising interest rates to curb inflation and have increased them by two-thirds of the limit. But the expectations that interest rates are raising don’t seem to be doing the full good, as the effect remains the same.

What economists say

Economists believe that in order to reduce inflation, central banks may set a target to raise interest rates by next year. In total, the opinion of 22 central banks was known in the survey, of which only six banks will be able to meet the inflation target by next year. A similar survey was conducted in July, in which two-thirds of 18 banks predicted they would meet their targets. But now this list includes only 6 out of 22 banks.

Why is the situation getting out of hand?

The situation also looks out of control due to turmoil in the global stock and bond markets, while, on the other hand, the US dollar is holding on to multi-year highs. The dollar also outperformed US exchange rate estimates in the foreign exchange market. Many currencies of the world seem to be collapsing in front of the dollar. Of the 257 economists surveyed, 179 believe that unemployment will rise sharply in the coming year and could fall sharply.

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Global growth is expected to be 2.3 percent this year in 2023, compared with an earlier estimate of 2.9 percent, according to a Reuters poll of economists covering the 47 largest economies. However, after that, this figure will rise to 3.0 percent in 2024. More than 70 percent of economists said the situation in the countries they cover will worsen in the next six months. The remaining 64 expressed hope for its improvement.

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