1.3 Expect the unexpected: How we might be wrong While we expect recession in 2023, it STEVEN WIETING could be deeper than we expect – or not Chief Investment Strategist and Chief Economist happen at all. We consider this and other risks to our views in both directions. ƒ Monetary tightening amid ongoing supply shocks will likely hurt economic growth in 2023, albeit with inflationary pressure diminishing ƒ Self-reinforcing, 1970s-style inflation would force key central banks to drive a much harder economic landing than we expect ƒ But if inflation fades quickly, the US economy particularly has a small chance of avoiding recession ƒ US-China military escalation or a complete breakdown of trade relations are major if improbable risks for the world economy ƒ Issues over Russia’s oil exports and Ukraine’s agricultural exports could still cause disruptions ƒ A large-scale cyberattack also could potentially create widespread economic damage ƒ In the face of all these and other risks, we advocate globally diversified asset allocation, in line with your specific investment objective Citi Global Wealth overview | | 18 Investments