Le Lézard
Subject: Economic News/Analysis

Russell Investments' mid-year 2023 global market outlook: Strategists anticipate delayed recession for slowing U.S. economy

Russell Investments' strategists continue to expect a recession for the slowly slowing U.S. economy, though they anticipate a delay until 2024 as investor enthusiasm for artificial intelligence and resilient economic growth continue to support stocks in the near term.

"Forward-looking recession indicators are all flashing warning signs, while measures of real economic activity such as jobs growth and household spending are only gradually moderating," said Andrew Pease, global head of investment strategy at Russell Investments. "This creeping slowdown in the United States seems likely to persist for a few more months."

Pease believes a later recession could be milder since inflation should have fallen by enough at that point to allow the U.S. Federal Reserve (Fed) to ease aggressively. A recession beginning in 2023 while inflation is still above the Fed's target would limit the pace of easing.

Pease added that most other major economies are also slowing and at risk from aggressive central bank tightening. This includes eurozone growth buckling under a steep decline in bank lending, persistent inflation forcing the Bank of England to tighten further despite the lack of UK economic growth, and China's growth impulse faltering after the post-pandemic lockdown surge.

"While eurozone equities have performed broadly in line with U.S. equities so far this year, we expect they'll soon face the cycle challenges of tight monetary policy and recession risks," Pease said.

The firm's strategists summarize their mid-year 2023 asset-class preferences as follows:

For more information, please see the team's 2023 Global Market Outlook ? Q3 update

About Russell Investments

Russell Investments is a global investment solutions firm providing a wide range of services to institutional investors, financial intermediaries and individual investors around the world. Building on an 87-year legacy of continuous innovation to deliver exceptional value to clients, Russell Investments works every day to improve the financial security of its clients. The firm has $288.3 billion in assets under management (as of 3/31/2023) for clients in 30 countries. Headquartered in Seattle, Washington, Russell Investments has 17 offices in major financial centers, including New York, London, Toronto, Tokyo and Shanghai.

Forecasting represents predictions of market prices and/or volume patterns utilizing varying analytical data. It is not representative of a projection of the stock market, or of any specific investment.

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