“The probability that the world economy slips into recession is close to 50%”, estimate Citigroup economists on Wednesday June 22, while “Central banks are tightening monetary policy and demand is falling”reports Bloomberg.
“Supply disruptions continue to drive up inflation and weigh on growth,” observe the experts of the financial company. And if central banks can still calm “slowly” economic overheating, “it will be necessary for the logistical tensions to ease and for the demand to resist” to avoid the crisis.
“Classic” recession
According to Citigroup, global growth is expected to be 3% this year and 2.8% in 2023. “If a recession did occur, it would likely be a ‘classic’ recession where unemployment increases by several percentage points and output experiences some weakness,” explains the bank.
The whimsical billionaire Elon Musk has a more decided opinion on the question. Speaking via video at the Qatar Economic Forum on Tuesday, he “adopted a sober tone” to answer questions from an editor of Bloombergexplains the American agency in another article. “He made no secret of his view that the US economy is heading for a crisis.” The CEO of Tesla and SpaceX said:
“A recession is inevitable at some point. As for whether there will be a recession in the near term, that is more likely than not…”
On Sunday June 19, US President Joe Biden insisted that“a recession [n’était] not inevitable”echoing critics who accuse its stimulus plan and the central bank of“fuel inflation”recalls the Financial Times.
According to the panel of economists polled by the Wall Street Journal, the probability of a recession in the United States later this year has “significantly increased”at 44%, compared to 28% in its last survey in April. “A level that you usually only see on the edge of a recession or during a recession,” notes the economic daily.