Crédito y Caución forecasts GDP growth in the US to have a soft landing at 2.6% in 2022 and 1.8% in 2023, with a risk of going through a mild recession sometime in 2024. The credit insurer expects further hikes in the benchmark interest rate in the second half of the year to end the year between 3.75% and 4.0%. US consumers are in a position of strength. The labor market is expected to gain some four million jobs in 2022 and the unemployment rate is expected to stabilize at around 3.5% in the second half.
In the UK, the report forecasts growth at 3.6% in 2022 and 1.3% in 2023. Inflation has accelerated to 40-year highs. At the same time, sterling has depreciated against the dollar due to increased geopolitical risk in Europe and interest rate hikes, which has led to higher import prices in the UK. Pressure on British households is high as prices rise and pandemic-related tax support has fallen, so Crédito y Caución forecasts that consumption will fall in the second half of the year. Net exports continue to weigh on UK GDP growth since Brexit. While they are expected to gradually improve by 2023, new tensions with the European Union related to the Northern Ireland protocol put this recovery at risk. A trade war would weigh significantly on UK growth.
In Japan, the economy is forecast to grow 2.0% in 2022 and 2.4% in 2023. As the economy reopens after the last wave of Covid-19, consumption growth is expected to increase, although inflation poses a risk to the recovery. Export growth is under pressure from slowing global growth and supply chain problems. Over 90% of Japan's energy consumption depends on imports, so the economy is also vulnerable to volatile world energy prices.