This week our cover looks at the threats facing the world economy, which has confounded even the most optimistic expectations with its performance over the past year. Only a year ago everyone agreed that high interest rates would soon bring about a recession. But those expectations have not been met. Around the world, inflation is falling, unemployment has mostly stayed low and the big central banks may have stopped their monetary tightening. Unfortunately, this success cannot last: interest rates look set to remain high, consumers’ excess savings—accumulated during the pandemic—will eventually run out and governments have towering debts to service. Peer ahead, and threats abound.

Leader: The world economy is defying gravity. That cannot last
Briefing: Markets think interest rates could stay high for a decade or more
Finance and economics: How Japan poses a threat to the global financial system