A global recession is a contraction in global gross domestic product (GDP) during which economic activity slows. It is usually defined as a sustained decline in GDP for at least a year, although the definition can vary. During a global recession, output is lower than normal and investment and consumption drop, according to the International Monetary Fund.

Global recessions are difficult to identify. They depend on low-frequency aggregate global data that smooths out fluctuations and may be masked by a surge in growth in other large economies. Also, the decline in real GDP per capita may not be felt equally around the world. For example, the 2008 financial crisis caused a global recession in developed countries but did not have much impact on China and India, whose economies grew during that period.

The COVID-19 pandemic has already had an impact on global economic activity, although not as severe as the 2008 financial crisis. As the pandemic recedes, the effects are likely to be felt more deeply. The combination of factors – including a global economic slowdown, higher interest rates and retaliatory trade tensions – could lead to the first global recession since 2009.

Some economists have warned of a global recession. JPMorgan Chase Chief Economist Bruce Kasman, for example, has raised his 2025 global recession forecast from 15% to 40%, citing the impact of tariffs and expectations of retaliation from trade partners. In addition, higher interest rates would likely push up global core inflation and slow global growth. This would have a negative impact on many economies, especially those with high levels of debt.