Don’t Count on a Soft Landing for the World Economy

For some time the world economy has seemed to defy gravity. Despite the fastest tightening of monetary policy since the 1980s, America’s economic growth probably accelerated in 2023. Europe has mostly weaned itself off Russian gas without economic catastrophe. Global inflation has fallen without big surges in unemployment, in part because labour markets have so far cooled mainly by shedding job vacancies not jobs themselves. As the year ends, optimists who predicted a “soft landing” are taking victory laps.