Global conditions today and those that are of a global recession, Figure I-4 assigns a expected to materialize in the coming months probability that the world is in a state of 2 are similar to conditions that have signaled recession at any given point in time. Only in global recessions in the past. Energy supply- 2001 was the probability of global recession as and-demand concerns, decreasing capital flows, high as it is today without an actual recession declining trade volumes, and falling output per taking place within the subsequent 12 months.3 person mean that, in all likelihood, the global From this we infer that the chances of a global economy will enter a recession in the coming recession in 2023 are very high. 1 year. Borrowing from the World Bank’s definition FIGURE I-4 Global recession indicator is at dangerous levels % Indicates global recession  Recession  probability % probability          Note: Probabilities derived from vector similarity matrixes for global unemployment, real per capita GDP, industrial production, foreign direct investment, trade, and global energy demand were used to identify similarities between the period under consideration and other recessionary periods. Sources: World Bank, British Petroleum Statistical Review of World Energy, OECD, Federal Reserve Bank of St. Louis FRED database, OeNB, CPB Netherlands Bureau for Economic Policy Analysis, and UNCTAD, as of October 31, 2022. Global unemployment data are from Kose, Sugawara, and Terrones (2020). 1 While there is no universal definition of a global recession, the World Bank defines a global recession as a period in which (1) annual global real GDP per capita declines and (2) there is strong evidence for a broad-based decline in multiple global economic activity indicators (Kose, Sugawara, and Terrones, 2020). 2 See World Bank, 2022, Risk of Global Recession in 2023 Rises Amid Simultaneous Rate Hikes, press release issued September 15, 2022, available at www.worldbank.org/en/news/press-release/2022/09/15/risk-of-global-recession-in-2023-rises-amid-simultaneous-rate-hikes. 3 A recession did occur in the United States from March to November 2001, though a global recession as defined by the World Bank was avoided. 10