LG경영보고서영어.txt

As the recession takes hold, global economic growth is expected to slow to 2.2% next year after 3.2% this year. The most difficult period is likely to come in the middle of next year, when the U.S. enters recession after Europe this winter. 
Compared to previous global economic downturns, this one is likely to be relatively mild. However, a mild downturn can be a double-edged sword, and without a significant reduction in demand, the downturn will not eliminate high prices. 
The intensity of the downturn and high prices is expected to be 'quasi-stagflationary', which is weaker than the oil shocks of the past, a typical stagflationary period.
Next year, the Korean economy is expected to experience an up-and-down trend, with economic growth slowing from 2.5% this year to 1.4% next year. Export growth is expected to fall to 0% and the trade deficit is expected to be prolonged. 
While consumption of not only goods but also services is close to its pre-COVID-19 trend, with wages rising faster than prices and employment shrinking, consumption is expected to slump in earnest. 
Inflation is likely to remain high despite the slowdown due to the spread of rising food and service prices, demand for higher wages in line with inflation, and long-delayed utility rate hikes.
Rate hikes in the U.S. and South Korea are likely to end in the first quarter of next year, but the policy rate divergence between the two countries is expected to widen further to more than 1.5 percentage points. The aftermath of this fast and furious rate hike cycle could be felt in international financial markets next year in the form of a European sovereign debt crisis or financial institution failures. The source of anxiety will shift from sharp monetary tightening to rising credit risk as the economy deteriorates.
However, domestic money market and bond market unrest is expected to be difficult to resolve. Among the major macroeconomic issues, from the perspective of business executives, there are three factors that will have the most direct impact in the coming year: whether the won/dollar exchange rate will stabilize, the emerging pattern of US-China competition, and the trend of commodity prices.
First, the KRW/dollar exchange rate, which has been volatile this year, has recently stabilized somewhat. However, the exchange rate is expected to remain unstable until the fourth quarter of next year, when it is expected to recover faster, as there are many uncertainties regarding European interest rates, China's economic recovery, and financial market turmoil. Second, the U.S.-China technology supremacy war is likely to enter a new phase of 'multipolarized' as the EU and major emerging economies join the fray. 
In the case of the EU, it has been supporting the US position and indirectly participating in public pressure, but in the future, it is preparing a system to support and protect major core industries and related raw materials to ensure an appropriate level of supply chain stability.