Although the global outlook has improved, "tighter lending conditions" and "hawkish central bank" policies will lead to a moderate recession in the United States, Fitch Ratings said in its latest Risk Headquarters report on Thursday.
"According to Fitch's base-case forecasts, this will include a shallow recession in the US, limited growth in the eurozone, and building risks to China's recovery," the agency cautioned, adding that core inflation continues to be "sticky" and well above central bank goals.
"As such, our Key Risks for global credit ... remain largely unchanged. These risks include negative scenarios for funding, asset valuations, and financial stability; inflation and interest rates; and geopolitics, governance, and policy," Fitch added.
