The World Bank reduced its 2023 growth forecasts on Tuesday to levels whereby numerous countries would find themselves nearing recession.
Having forecast global growth at 3.0% in June 2022, the World Bank now expects 2023 global GDP growth to be around 1.7%; the slowest pace outside of the 2009 and 2020 recessions.
“Given fragile economic conditions, any new adverse development — such as higher-than-expected inflation, abrupt rises in interest rates to contain it, a resurgence of the COVID-19 pandemic or escalating geopolitical tensions — could push the global economy into recession,” the bank explained in a statement.
According to the bank, slowdowns in major world economies could lead to another global recession just three years after the previous one. The World Bank has forecast just 0.5% growth for the United States and the eurozone.
Business investment is also expected to grow at a slowing rate, with a forecast of 3.5% being posted by the World Bank. The bank did note, however, that inflationary pressures across the globe began to subside during the closing stages of 2022, with energy and commodity prices being pushed down from their peak figures.