Bets are often placed on when the next recession will arrive. It may surprise some, but even serious publications have asked fifty economists to guess the US recession timeline. A large share expect it within 2023, with many pointing to the second quarter, though there is disagreement about the exact quarter.
A recession is defined by two consecutive quarters of negative GDP growth. The reasoning involves rapid, aggressive rate hikes by the Federal Reserve to combat inflation. Inflation in the United States has been high, and recent data suggests a rate that remains well above typical targets. This backdrop makes the timing of a downturn a hot topic for debate.
It is worth noting that similar research has not been conducted in Spain, yet concerns about global economic conditions persist. Some speculate about a looming slowdown in Europe during the summer and a more severe downturn in the autumn. In conversations about markets, questions arise about who benefits from volatility and who bears the brunt when uncertainty climbs. Market participants, including those in Europe and the United States, anticipate moves by central banks, with expectations for higher policy rates in the euro area to address persistent inflation.
The situation in the 21st century is filled with unpredictable shifts. While there is no certainty that a recession will occur, there is also no data that supports a strong claim that one is imminent. Growth projections for the euro area and the broader economy remain modest, and inflation is forecast to ease gradually through the year. Analysts generally expect continued expansion in 2023, with growth figures above outcomes seen in the years before the pandemic, and without a clear consensus calling for a recession.
Some observers point to two facts that seem to influence public sentiment. First, there is a widening social gap when a notable portion of the population reports difficulties in daily life and social interactions. A sizable share faces constraints on travel or social participation due to economic pressures. Higher costs for energy and food have reduced spending power, especially for those with limited means. The impact of rising prices on everyday essentials is evident in the cost of groceries, which increasingly weighs on household budgets.
The second point concerns the normalization of monetary policy and how it unfolds in real terms. The European Central Bank has signaled a cautious path, including the tapering of net asset purchases and the prospect of the first rate hike in years. It is possible that the ECB will continue to manage debt purchases to address risk premiums and to align with debt maturity needs through the coming period. If inflation moderates later in the year, the likelihood of further tightening within European policy may diminish.
When markets lack clarity, some commentators advise caution and prudence, suggesting that speculative bets should be limited.
There is no evidence of a new housing bubble forming. Price rises in property have helped shelter households from the more extreme effects of the last housing boom, avoiding the depth of the 2008 crisis.
Current statistics show a mixed picture for Spain: housing demand is recovering at a steady pace, and price growth has been robust across multiple regions. The official price indices show new homes still below 2009 peaks, and second-hand homes have not yet reached their old highs either.
The housing market today is characterized by a larger share of demand for existing properties, while new construction remains relatively constrained. Limited land supply and policy gaps that hinder affordable access to home ownership for younger buyers contribute to a slower pace of new housing starts. As a result, many aspiring buyers rely on the second-hand market, with rental prices also rising to meet demand.
In this climate, job security and optimism are common concerns. The risk persists that some countries may profit from debt disinflation or intentional market distortions, much like past episodes where investors tested the boundaries of sovereign risk. The overall outlook emphasizes careful attention to economic signals and the potential consequences of speculative moves in financial markets.