Highlights:
- Various shocks challenge the global economy, with different undercurrents driving the economic outlook across regions.
- The euro area and the US are headed for recession, while the Chinese growth engine is sputtering. However, the outlook starts to brighten in 2024, once China leaves its zero-Covid behind and the US economy exits from its downturn.
- Inflation pressures will slowly recede, allowing central banks to gradually exit their tightening mode and rate cuts could return to top the central bank agenda in early 2024.
- Risks primarily stem from renewed geopolitical tensions, energy shocks and a return of the pandemic through new variants.
