The global economy looks set to absorb some strong body blows, as in the last weeks J.P. Morgan has notably marked down its forecasts for both the US and China, and global recession risks are on the rise. This past week J.P.

Morgan revised down 2022 forecast GDP growth in China from 4.3%y/y to 3.7%, with a sharper 2Q contraction (-5.4% q/q, saar) bouncing into a stronger assumed 3Q recovery, but still plenty of uncertainties and risks (See H. Zhu and team). A month ago China’s 2022 GDP was seen at 4.6%y/ y. Amid the unclear outlook, 2023 growth in China has been kept roughly stable, currently at 5.3%y/y. Meanwhile, US growth prospects are now notably more subdued. GDP growth in 2022 and 2023 stood at 3.5%y/y and 2.3%y/y in J.P. Morgan’s forecast a month ago, prior to the release of a contracting 1Q22. With the Fed now determined to tighten financial conditions, our U.S. economists have taken 2022 and 2023 GDP forecasts down to 2.7%y/y and 1.8%y/y respectively (see M. Feroli and team).