Why the IMF says 2023 will feel like a recession

STORY: The IMF says 2023 will feel like a recession

Trillions of dollars were spent during the pandemic on keeping businesses and households afloat.

But as lockdowns ended, the global economy boomed.

Factories couldn’t keep pace. Lingering restrictions created labor shortages. And energy prices spiked.

Then Russia invaded Ukraine - sending fuel costs even higher.

The International Monetary Fund is warning “the worst is yet to come and for many people, 2023 will feel like a

recession."

Why it matters

Double-digit inflation hits people on low incomes the hardest.

The squeeze on living costs is tightening as winter fuel bills soar.

Striking workers want wages to keep pace with inflation. But they’re often having to settle for less.

The World Food Programme estimates an extra 70 million people worldwide have been driven closer to starvation since the start of the Ukraine war - in what it calls a "tsunami of hunger".

What it means for 2023

Central banks have hiked interest rates to cool demand and tame inflation.

The IMF predicts global inflation at 4.7% by the end of 2023 - less than half its current level.

The aim is for a soft landing without housing crashes, bankruptcies or surging joblessness.

But that best-case scenario has proven elusive in the past.