Global economy continues to cool; Is a recession looming?

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Per IPCs Economic Outlook May 2023 According to the report, the global economy is continuing to cool down, but not quite as much as was expected at the beginning of the year. Stronger than expected growth in 2023 will come at the cost of weaker growth in 2024.

Despite the widespread perception that a recession is imminent, labor markets remain extremely strong. Both the United States and Europe are seeing record low unemployment. Strong labor markets and solid wage growth are those should keep inflationary pressures stubbornly high.

“Consumer confidence has fallen sharply over the past month, erasing half of gains since the all-time low of June 2022. Business confidence was also weak. Manufacturers are reporting a muted outlook in both the US and Europe,” said Shawn DuBravac, IPC chief economist. “Early economic indicators continue to point to a high risk of recession this year, even as the timing continues to shift later in the year,” said You Bravac added.

More data in May 2023 IPC Economic Outlook show:

• US consumer sentiment fell nearly 7 percent in May. Debt ceiling debate may have contributed in part to this decline.
• US manufacturing sentiment contracted in April for the fifth straight month. Manufacturing PMI rose 0.8 percentage point last month, but not enough to return to expansionary territory.
• The European economy grew in the first quarter of the year, growing by 0.1 percent in the euro area and 0.2 percent in the EU.
• Electronics manufacturing output declined in March, falling sharply by 5.9 percent month-on-month and 1.7 percent year-on-year.

view May 2023 IPC Economic Outlook. For more information on the IPC’s Industry Intelligence program, including the latest research and reports, visit www.ipc.org/advocacy/industry-intelligence.

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