The global economic outlook is as clear as mud

This is Bloomberg Opinion Today, a panic-powered panoply of Bloomberg Opinion’s opinions. Sign up here. Today’s Agenda The economy remains a [Bloomberg]( Follow Us [Get the newsletter]( This is Bloomberg Opinion Today, a panic-powered panoply of Bloomberg Opinion’s opinions. [Sign up here](. Today’s Agenda - The [economy remains a riddle](, wrapped in a mystery, inside an enigma. - Inflation to the left of us, [recession to the right]( … - Russia’s rising ruble [discombobulates banks](. - Monkeypox is a [clear and present danger](. Are We in Recession? ¯\_(ツ)_/¯ The debate about whether the world’s largest economy is in a recession, or headed for a recession, or sufficiently robust to avoid a recession, just got even more complicated. Friday’s US employment report showed total payrolls at a record high, with companies adding twice as many workers as economists forecast. “Job gains in July were a monster,” notes Jason Schenker of Prestige Economics. Google Trends may offer a better real-time guide to whether the economy is contracting than any official judgment from the National Bureau of Economic Research, the group that documents business cycles. Lags in data, as well as revisions, delay its pronouncements. For Gary Shilling, there’s a sufficiently high correlation between waning consumer confidence and appearances of the word “recession” in internet searches [to settle the argument](. Rising energy prices, increased mortgage costs, excess retail inventories and a bursting housing market bubble all point to a self-reinforcing trend. “Consumers are worried about a recession and retrenching, thereby increasing its likelihood,” Gary writes. The Federal Reserve will prioritize curbing consumer prices over keeping the economy afloat. “After being behind the curve as inflation surged, the central bank badly wants to restore its credibility,” Gary argues. One central bank has unequivocally admitted that the outlook is bleak. On Thursday, the Bank of England raised its benchmark interest rate by half a percentage point, its biggest increase in 27 years, taking the rate to 1.75%. As well as forecasting inflation will peak at more than 13% this year, compared with its 2% target, the Old Lady of Threadneedle Street predicted that the UK is set for two long years without any growth: John Authers cannot recall policy makers at any large industrialized nation ever being so negative about the prospects for their own economy. Predicting a double-digit surge in consumer prices accompanied by a severe recession — and then raising borrowing costs anyway — displays [breathtaking candor by the BOE](. “Many of us spend our time demanding more in the way of brutal honesty from central banks,” John writes. “This is what it feels like when we get it.” Dan Moss is less convinced that central bankers have the collective stomach to “tolerate a downturn, if not outright engineer one.” He points to [this week’s statement from the Reserve Bank of Australia](, which echoed the Bank of England in raising rates by half a point while predicting weaker growth and faster inflation, but also emphasized the importance of “keeping the economy on an even keel.” Dan suggests keeping a close eye on New Zealand’s central bank, which was early in tightening policy and is now seeing unemployment edge higher at the same time as house prices drop and business and consumer confidence declines. “A certain amount of prudence will naturally enter the rate dialogue as more central banks move to neutral,” Dan argues. “The race to outdo each other with ever more sizeable hikes will soon subside.” An Embarrassment of Russian Riches The ruble has been on a tear, climbing by almost 25% against the dollar and gaining 40% against the euro in the past six months. The Russian currency’s strength, albeit exacerbated by thin trading volumes, is boosting profits for Western banks that haven’t yet exited the country — which is [kind of embarrassing](, argues Paul J. Davies. The climbing currency is swelling the value of Russian assets faster than banks can offload them. Citigroup Inc., for example, divested $3.1 billion of assets in local currency terms in the second quarter. Ruble gains, though, increased the size of its remaining portfolio, leaving it with net growth of $500 million. Austria’s Raiffeisen International Bank, which has the biggest Russian exposure relative to its size, cut loans in the country by 22% in the second quarter but still saw its assets grow by 3.1 billion euros ($3.1 billion) With Russia’s economy weakening and trade with the rest of the world unlikely to resume any time soon, those gains could prove fleeting. “The banks need to find solutions to their Russian exposures,” Paul writes. “One good quarter shouldn’t tempt any bank into a risky rethink on Russia.” Telltale Maps The US has declared the monkeypox outbreak [a public health emergency](. “It’s long past time,” argues Lisa Jarvis. Further Reading ESG is losing its mojo. — Elements by Javier Blas (Sign up for Bloomberg’s new daily energy and commodities newsletter [here](.) England’s Lionesses brought football glory home. But [how much is it worth?]( — Therese Raphael [What to do]( when SoftBank says ‘not for us!’ — Andrea Felsted Toyota shows [it’s (still) going to be hard to get a car](. — Anjani Trivedi The problems at Pinterest and Paypal [won’t be solved overnight]( by Elliot’s intervention. — Martin Peers Taiwan Semiconductor Manufacturing Company chose to side with the US. [Now it must handle China’s reaction](. — Tim Culpan ICYMI Fertility treatments are already a grueling route to building a family. With embryos gaining new legal protections in the US, [IVF could be criminalized](. World food prices [dropped almost 9% in July](, their biggest decline since 2008. [German power prices are at record highs]( as power plants start to buckle because of the heatwave. Actor Kevin Spacey was [ordered to pay $31 million]( to the “House of Cards” production company. Kickers Two-thirds of Australia’s Great Barrier Reef recorded [the highest amount of coral cover]( in almost four decades. Malaysia’s Special Task Force Jihad Against Inflation [aims to stockpile 4,536 metric tonnes of chicken](by the end of December to ensure stable prices. Historians in Birkenhead hope to reveal [why a German U-boat disobeyed orders](in the dying days of World War II, after unsealing a treasure trove of recovered objects including two Enigma cipher machines, dozens of bottles of French wine and about 200 condoms. (h/t Therese Raphael) Notes: Please send inflation-proof poultry and complaints to Mark Gilbert at magilbert@bloomberg.net. [Sign up here]( and follow us on [Instagram](, [TikTok](, [Twitter]( and [Facebook](. Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](. 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