The US Economy Is Under Recession But India Is Safe
Reuters polls of economists predict a slowdown in the global economy including the US which is the largest economy in the world. But they say India faces no such threat.
Ten Points
- The report forecasts a 3% slowdown in the global economy followed by 2.8% the next year compared to the 3.5% and 3.4% in the last quarterly poll in April.
- The poll covered 48 economies out of which 77% were downgraded for the next year only, 13% are left unchanged, and 10% upgraded.
- The poll covered the top 19 global banks out of which 11 are forecast to see inflation returning next year.
- The remaining 8 banks will remain safe. They include the Fed, the European Central Bank, the Bank of England, and the Reserve Bank of India.
- The US Federal Reserve is expected to increase rates by another 75 basis later this week. It is an indication of inflation being at a four-decade high of 9.1%.
- The US has only a 40% chance of seeing recession but it is sharply up from three months ago. The chances of recession have also risen for the euro zone and Britain.
- Inflation forecasts for 48 economies show no quick relief from a cost of living in those countries. The inflation report of 90% of the economies has been upgraded for the next year and over 45% for 2024.
- Recessionary dynamics are increasingly evident in the forecast. Nathan Sheets, the chief global economist at Citi, forecast the major economies including the US slipping into recession.
- Nathan Sheets further maintained that the timing of recession could vary and the effect could be relatively mild.
- Noted Ethan Harris, global economist at Bank of America Securities, said that the economists