Why The World Economy to Enter Into Recession in 2023

World economy to enter into recession in 2023, researcher says

Higher borrowing costs to fight inflation will lead to a global recession, according to the Centre for Economics and Business Research.

“We expect central bankers to stick to their guns in 2023 despite the economic costs. The cost of bringing inflation down to more comfortable levels is a poorer growth outlook for a number of years to come,” the CEBR said.

economic downturn recession 2023

The report also predicts that:
– The APAC region will account for over a third of global output by 2037, while Europe’s share will shrink to less than a fifth.
– China will overtake the US as the world’s largest economy no sooner than 2036, 6 years later than expected due to its zero Сovid policy and rising trade tensions with the West.
– India will become the third $10 trillion economy in 2035 and the world’s third-largest by 2032.
– The UK will no longer grow faster than its EU peers.
– Emerging economies with natural resources will get a “substantial boost.”

BlackRock warns of a recession unlike any other

A global recession is just around the corner as central banks aggressively hike borrowing costs to curb inflation – and this time it will cause more market turbulence than ever before, according to BlackRock’s Global Forecast for 2023.

The global economy has already exited a four-decade era of stable growth and inflation to enter a period of heightened instability.

This means policymakers will no longer be able to support markets as much as they did during past recessions.

“What worked in the past won’t work now,” the strategists noted.

“The old playbook of simply ‘buying the dip’ doesn’t apply in this regime of sharper trade-offs and greater macro volatility. We don’t see a return to conditions that will sustain a joint bull market in stocks and bonds of the kind we experienced in the prior decade.”

Still, the stock market hasn’t yet factored in the potential magnitude of the impending economic downturn, the strategists said.

Sber plans to open a branch in China by the end 2023

Russia’s lender Sberbank expects to open a branch in China by the end of 2023, First Deputy Chairman Alexander Vedyakhin announced. At the same time, Sberbank already has a representative office in China.

“We are proactively communicating with the Chinese authorities,” Vedyakhin said. “I hope we will manage to open the branch in China by 2023 year-end, it normally takes 1.5-2 years. We hope we will have the branch in this country by the end of 2023.”

Vedyakhin also said that Sberbank would be forced to close its office in the United Arab Emirates early next year due to sanctions pressure, adding that Sberbank would continue to serve clients in the UAE market.

Earlier in March, Sberbank’s European arm, based in Vienna, was closed by order of the European Central Bank.

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