Economics Inflation Fixed Income Commentary

Global Macro Outlook - Third Quarter 2023

July 03, 2023
3 min read

What You Need to Know

Steadfast global resilience to recession highlighted the quarter, although the outlook hasn’t necessarily improved. But with labor markets tight and wages keeping pace with inflation, consumers are navigating the economy’s rough patches. Still, we expect growth to slow in time.

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Key Forecast Trends

  • The global economy proved resilient to recession during the quarter, although the general outlook hasn’t meaningfully improved.
  • Employment growth remains strong, especially in developed markets, while wage growth has kept pace with inflation in most major economies.
  • Central banks in several countries resumed rate hikes, after signaling an end to tightening; both the Fed and ECB indicated that the terminal rate could be higher than expected.
  • Risks remain, since tightening cycles usually end in financial turbulence and a potential hard landing in China could prove problematic.
  • We see a sustained period of below-trend growth, which we believe could be rewarding for those willing to stay patient through the inevitable bumps along the way.
The Global Cycle for 3Q:2023

Global Forecast

Forecast Overview

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