The head of the World Bank has declared a “perfect storm” of raising interest rates, high inflation and slowing growth.
A period of low growth and high inflation in the global economy could be dragged out for years by Russia’s invasion of Ukraine, as it will take time to withdraw energy from Russia. This is what World Bank President David Malpass said, reports on Thursday, September 29, Reuters.
In his speech at Stanford University, Malpass noted that the likelihood of a recession in Europe is increasing, as China’s growth slowed sharply and US output fell in the first half of the year. These developments will have serious implications for developing countries, Malpass stressed.
function news4520264() {
$.get(‘//’ + window.location.host + ‘/ajax/module.aspx?spm_id=444&id=4520264&lang=2&IsAjax=true’, function (data) { $(‘#nk4520264’).html(data); });
}
news4520264();
Overcoming the current “perfect storm” of higher interest rates, high inflation and slower growth requires new macro- and microeconomic approaches, he said.
He also noted that the bank’s forthcoming Poverty and Shared Prosperity report showed that decades of progress in reducing poverty had slowed in 2015, even before the COVID-19 pandemic pushed another 70 million people in dire straits.
The report, to be released next week, also showed a 4% drop in global median income, the first decline since the bank began measuring this figure in 1990.
“The developing world faces an extremely challenging near-term outlook driven by rising fertilizer and energy prices, rising interest rates and credit spreads, currency devaluations and capital outflows,” Malpass said. .
“The grave risk for the developing world is that a sharp slowdown in global growth will turn into a global recession,” he said, noting that many of these countries are still struggling to return to pre-pandemic levels of per I’ve already earned it.
He urged countries to find ways to reduce inflation beyond the current highly synchronized increase in interest rates, including through fiscal efficiencies to better target spending to the poor and vulnerable.
Earlier, the Organization for Economic Cooperation and Development said that the war in Ukraine will affect the global economy more than expected.
News from Correspondent.net on Telegram. Subscribe to our channel Athletistic
Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.