For Industry Week
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“The world’s three major engines of growth — the United States, the euro area and China — are undergoing a period of pronounced weakness,” the World Bank said.
Global growth is slowing “perilously close” to recession, the World Bank said Tuesday, slashing its 2023 economic forecast on high inflation, rising interest rates and Russia’s invasion of Ukraine.
Economists have warned of a slump in the world economy as countries battle soaring costs and central banks simultaneously hiked interest rates to cool demand — worsening financial conditions amid ongoing disruptions from the war in Ukraine.
The World Bank’s latest forecast points to a “sharp, long-lasting slowdown” with growth pegged at 1.7% this year, roughly half the pace it predicted in June, said the bank’s latest Global Economic Prospects report.
This is among the weakest rates seen in nearly three decades, overshadowed only by the pandemic-induced downturn of 2020 and global financial crisis in 2009.
“Given fragile economic conditions, any new adverse development… could push the global economy into recession,” the Washington-based development lender said.
These include higher-than-expected inflation, sudden spikes in interest rates to contain price increases or a pandemic resurgence.
World Bank President David Malpass told reporters Tuesday: “I’m concerned, deeply concerned that the slowdown may persist.”
