Key facts
- The global economy has managed to avoid a feared crash despite significant energy shocks and geopolitical tensions.
- Wiggle room for the global economy is narrowing.
- The outlook for the global economy is darkening.
The global economy has, for a period, defied expectations by navigating significant challenges, including an energy shock triggered by attacks on Iran. This disruption, described as the largest in history, led to increased oil prices, broader conflict in the Middle East, fuel shortages, and inflationary pressures. However, a feared widespread economic crash did not materialize, with most economies managing to persevere. Despite these resilient outcomes, the available flexibility for global economies is diminishing, coinciding with a worsening economic outlook.