The World Bank’s flagship Global Economic Prospects report for June 2023 outlines how the global economy remains in a precarious state.

The World Bank’s latest projections indicate that the world economy will remain frail—and at risk of a deeper downturn—this year and in 2024.

Inflation pressures persist, and tight monetary policy is expected to weigh substantially on activity. Recent banking sector stress in advanced economies will also likely dampen activity through more restrictive credit conditions. The possibility of more widespread bank turmoil and tighter monetary policy could result in even weaker global growth.

The global economy is short of the necessary strength to eliminate extreme poverty, counter climate change, and replenish human capital. Low-income countries are especially vulnerable. These countries spend only the tiniest fraction of government revenues on their most vulnerable citizens—barely 3% of GDP.

This report offers a roadmap for policymakers— not only for avoiding the worst outcomes but also on how to put the global economy back on track. Comprehensive policy action is needed at the global and national levels to foster macroeconomic and financial stability. In addition to the global and regional outlook chapters, the report includes analytical pieces on financial spillovers of rising U.S. interest rates and fiscal challenges confronting low-income countries.