Jiří Filip Press Release: The last few years have been like a rollercoaster in the markets, after a flash crash at the beginning of the pandemic, we experienced euphoric growth only to start falling again in the second half of 2022. So what could we expect in 2023? Will there be a recession or a turnaround? Of course, no one can predict the future, but we can determine the most important aspects to focus on. The XTB analytical team therefore prepared e-book focusing on this topic, you will find in it seven key questions and a subsequent analysis of the given situations, which can help us navigate the markets in the following year.
What are the topics?
USA and its economic situation
Like it or not, America, its economy and currency are central to the entire world. The US, like the rest of the world, is dealing with high inflation, which, although not as high as here, is nevertheless a big problem. If positive change is to come, inflation must begin to decrease, which should also lead to a change in the FED's behavior. It is therefore important for us whether the American inflation will decrease and whether we will see a reversal of the FED, i.e. the beginning of the reduction of interest rates in the USA.
The war in Ukraine
The conflict in Ukraine undoubtedly poses many problems and the European continent is affected by it more than any other region. Without calming the situation, it will be very difficult for Europe to use its full economic potential.
Oil and gas prices
Closely connected with the topic of Ukraine are the prices of commodities, especially oil and natural gas. They represent a problem not only for ordinary citizens, but for the entire economy. If prices remain high, firms' costs will be high, making the overall product more expensive, exacerbating the overall problems in markets in many sectors. A drop in their prices could help the whole situation improve.
Real estate bubble in China
Although not much has been heard about China's real estate sector in recent months, problems still persist. China is the second largest economy in the world after the USA, and in the event of problems, it can be expected that the situation would spread beyond its territory. In addition to the bubble in the real estate sector, the country has also faced problems with covid restrictions, mass protests and the overall negative effects associated with the suspension of the economy in recent months. It is therefore very important for the markets that the situation in China at least does not deteriorate further.
The crypto industry and its scandals
The cryptocurrency world is probably going through the worst period in its history. The fall of one of the largest cryptocurrencies Terra/Luna, the collapse of the second largest crypto exchange in the world FTX and many other problems brought this market to its knees. Will he still be able to recover, or is this really the end?
Will we see an economic recession?
The word recession has been scaring investors for months. If the problems mentioned above continue, or even worsen, the chances of a recession will be high. The situation therefore definitely needs to be monitored. A true multi-year recession would be a problem for most portfolios and investments.
- If you are interested in learning more about these topics, the entire analytical report, including a complete analysis of the given situations, is available for free on the XTB website here: https://cz.xtb.com/trzni-vyhled-2023
