The Blubber

JPM's half year outlook looks like this, published in July 11th. They have now reverted their recession calls:

Global inflation looks set to cool but will likely remain above comfort levels at 3%.

• With persistently high inflation, further tightening is likely to occur.
• A synchronized global recession may be the consequence, hitting sometime before the end of 2024.
• In light of this, J.P. Morgan Research expects to see a more challenging macro backdrop for stocks in the second half of 2023.

The outlook for the global economy

Global economic growth is likely to moderate in the second half of 2023, while inflation looks set to cool off. That being said, global core inflation will remain high at above 3% through to 2024. “We do not think inflation is going to come back down to central bank comfort zones by themselves,” said Bruce Kasman, Chief Global Economist at J.P. Morgan. “Yes, there’s a decline going on. But no, we do not think you’re going to get inflation back below 3% in the U.S. or the euro area this year in an environment where supply has been damaged in a more lasting way and inflation psychology has shifted.” Persistently high inflation will keep the pressure on central banks, meaning further tightening could well lie ahead.