According to World Bank, a global recession is quite likely to occur in 2023.

The World  Bank has voiced concern that the world may be on the verge of a global recession as a result of central banks raising interest rates to battle inflation concurrently around the world.

The three largest economies in the world, the United States, China, and the euro area were also noted to be slowing down significantly, and the report noted that even a ‘modest blow to the global economy over the next year might tip it into recession.’

The global economy had recovered from recessions since 1970, but was now experiencing its worst slowdown, according to the bank, which also noted that consumer confidence had already fallen more dramatically than in the years preceding past global recessions.

President of the World Bank David Malpass stated that ‘global growth is slowing rapidly, with further slowing probable as more nations slip into recession,’ adding that these trends would continue, with disastrous effects on emerging market and developing economies.

The bank warned that raising interest rates and other relevant policy measures might not be enough to reduce inflation to pre-COVID-19 levels.

The global core inflation rate, excluding energy, might remain at roughly 5% in 2023, about double the five-year average prior to the pandemic, if supply disruptions and labour market pressures don’t abate.