IMF’s Managing Director Predicts Intense Recession In 2023; How Badly Will Crypto Be Hit By This?
International Monetary Fund (IMF)’s chief Kristalina Georgieva foresees a global recession, which will worsen the current decline in the cryptocurrency market.
Prediction Of A Worsened Global Recession
In a recent interview on January 1st, the IMF’s Managing Director informed the public that a severe recession is on the way that will affect one third of the global economy including the cryptocurrency industry causing a further slump in its economy.
Georgieva argues that while 2022 suffered an intense recession, the worst is still to come. She predicts that 2023 would be significantly worse causing a tighter economy than previous years.
This year’s worsening recession follows a decline in China and the EU’s economy.
While the European Union is far too deep in this decline and has started to slow down, making it vulnerable to being severely impacted by the impending recession, Georgieva however projects hope for the United States, saying it might escape the clutches of this economic disaster.
Due to the sanctions placed on Russia as a result of its invasion of Ukraine, the economy has begun to deteriorate, which has also had an impact on the European Union as Russia shut down its pipelines supplying gases to the EU and the US.
Countries With Declining Economy
China has already begun to experience an economic collapse.
Due to the Covid 19 outbreak case and the rising number of Positive test cases, the country was forced to shut down the majority of its operations.
Citizens and Residents were instructed to stay away from their places of employment and educational institutions.
The country’s economy was severely impacted by this single event, and it suffered during the lockdown.
Georgieva claims that the slowdown in the economy’s major industries will have an impact on newly developing industries.
As this slowdown gradually affects many industries, it will eventually result in a downturn on a global scale.
According to Georgieva, a third of the economy would be impacted by this economic collapse, and there is a 25% chance that the global Gross Domestic Product will see a 2% increase.
Reports and speculations indicate that the cryptocurrency market will also see a downturn during this difficult period.
Investors would be compelled to look for alternative ways to withdraw money due to the crisis.
On the plus side, investors may use Bitcoin as protection against this recession.
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