JP Morgan: How Europe escaped recession – China’s role in the return to growth

Lower gas prices mean that the Eurozone will avoid recession, JP Morgan estimates as it upgrades its forecasts for the European economy.

In particular, the American investment house now estimates that the Eurozone will show growth of 1% this year and 0.9% in 2024, since all indications from the fourth quarter of 2022 show that the economy has been resilient.

THE JP Morgan believes that the fourth quarter of 2022 saw the European economy contract by 0.5%, but the first quarter will bring positive growth rates of 1%, as the PMI recovery has already signaled a return to growth.

The house recognizes that the “unknown X” for the European economy is China, which seems to be recovering rapidly, but could also cause further disruption.

It is noted that JP Morgan has reduced its odds recession for both the US and the global economy, seeing the resilience of the private sector, the rapid smoothing of supply chain problems and the mild easing of financial conditions around the world.

Against the background of the best forecasts developments in the USA, Europe and Chinathe house is upgrading its estimates for the growth of the global economy in the fourth quarter of 2022 to 1.8%, a full percentage point higher than it expected at the beginning of the year.

With China’s opening expected to bring growth of around 7% and Europe avoiding recession, JP Morgan now sees the global economy recovering at a rate of 2.5% in the first half of 2023. For the year as a whole , the house expects 2.2% growth for the global economy.

moneyreview.gr

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