Economic weakness is expected to usher in a recession in early 2023, according to a new report from The Conference Board. As ongoing inflation continues to put pressure on the economy, gross domestic product (GDP) is expected to slow to 0.2 percent in 2023, followed by a rebound to 1.7 percent in 2024.

Despite high inflation and rising interest rates, consumers continue to spend, spurring on GDP growth. In Q3 of 2022, data showed a strong economic momentum, prompting the Conference Board to upgrade their forecasting for Q4 2022 to 1.9 percent vs. the original forecast of 0.7 percent. 

With revised figures for 2022 and 2023, the Conference Board still believes that a recession is on the horizon sooner rather than later. It predicts the next three quarters to have negative GDP growth starting in Q1 of 2023. The report notes that the downtown is expected to be brief, with a rebound slated for 2024 as inflation falls and the Federal Reserve loosens monetary policy. 

The Conference Board also predicts that easing supply chain constraints will also begin to cool inflation, but that rising interest rates may continue to push the U.S. economy into recession. This will result in a tight labor market and higher unemployment rates. The Conference Board expects jobless rates to peak at 4.5 percent, a historic low.