Economy Slowing, but Far Better Than Feared

Wall Street Journal (11/23/22) Hannon, Paul; Cambon, Sarah Chaney

Although the global economy is slowing near the end of a turbulent year, economists indicate that the deterioration in activity may not be as severe as feared in recent months and could reach a bottom in the coming year. Some economists believe the U.S. economy will experience two consecutive quarters of contraction in the first half of 2023. S&P Global said its composite output index for the U.S., which includes services and manufacturing activity, dropped to 46.3 in November from 48.2 a month earlier, among the quickest contractions since 2009. An index below 50 signals contracting economic activity.

Still, the Organization for Economic Cooperation and Development forecasts U.S. economic output will grow at an annual rate of 0.5% in 2023, down from an estimated 1.8% in 2022. Economists polled by the Wall Street Journal say U.S. gross domestic product will grow at an annual rate of 0.4% in 2023, and they see an increasing chance for a recession in the next year.

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