the world economy is showing new signs of slowing down as china’s postcovid rebound fades and germany’s struggling industrial sector threatens to pull europe’s powerhouse into recession those weaknesses are emerging as the stillresilient us economy comes under pressure from the worst banking scare since the financial crisis as well as a debtceiling standoff that threatens default treasury secretary janet yellen warned on tuesday that “time is running out” to avert catastrophe the latest data suggest that key parts of the upbeat case for a global pickup aren’t working out as hoped china’s reopening after an abrupt pivot away from covid zero policies has run out of steam and a mild winter in europe hasn’t been enough to revive germany’s industrial base “the growth optimism from the start of the year has clearly given way for more sense of reality or simply disappointment” according to carsten brzeski global head of macro at ing “china and europe are already losing momentum again and with everything going on in the us the second half of the year doesn’t look any better” chinese data out tuesday showed industrial output retail sales and fixed investment grew at a much slower pace than expected in april the unemployment rate for young people jumped to a record high of 204 the figures confirm that china’s reopening isn’t lifting global demand the way many had anticipated said hao hong chief economist at grow investment group ongoing weakness in the property sector and in the order books of china’s exporters will do little to lift sentiment “we need the chinese consumer to do well to save the day” hong said in germany investors’ confidence waned for a third month reigniting fears of a recession the zew institute’s gauge of expectations fell to 107 in may from 41 in april the first subzero reading of 2023 even before that an unexpectedly big drop in in industrial output had raised concern that europe’s top economy may have already fallen into a winter slump the international monetary fund trimmed its global growth projections last month forecasting an expansion of 28 this year and 3 in 2024 on tuesday the fund warned that tight monetary policy and the adjustment to higher energy prices are weighing on germany it expects economic growth “to stay near zero in 2023” before gradually strengthening in the following three years while the world’s largest economy continues to defy predictions of a downturn us retail sales increased in april suggesting consumer spending is holding up headwinds are building the failure of several regional banks is making access to credit harder for smaller businesses and households economist surveys point to a 65 chance of a recession in the coming 12 months if the world economy does falter central banks can deliver some relief according to mark zandi chief economist at moody’s analytics most monetary authorities are near the end of their tightening cycles amid signs inflation has peaked he said while strong labor markets and household finances will also help put a floor under growth “it will be a difficult year from the global economy” zandi said “but with some reasonably good policymaking by central banks it should skirt recession” investors are already fretting about the outlook with sentiment among fund managers the most bearish this year according to bank of america corp’s latest survey traders are betting that a slowdown will force central banks including the federal reserve to lower interest rates later this year swaps markets point to more than 50 basis points of cuts by december in the fed’s benchmark rate which is now in a range of 5 to 525 there might be more gloomy economic news to come with warnings from manufacturers pointing to pressures that are still building said janet mui head of market analysis at brewin dolphin “companies are reporting that orders are slowing” she said “the slowing growth in china export numbers is very telling of global demand” with assistance by michael mackenzie and alexander weber