On July 26, the International Monetary Fund (IMF) cut its global growth forecast to 3.2% from a forecast of 3.6% made in April amid high inflation and conflict. in Ukraine, and warned that the world could “tilt on the brink of a global recession”.
In its global growth forecast update on Tuesday, the IMF warned of risks to the global economy that, if left unchecked, could push the world into recession.
The IMF said the global economy entered 2022 in a weaker position than previously expected, held back by the spread of the omicron variant of the coronavirus, rising energy prices and disruptions. continuous supply.
High inflation and the risks posed by Russia’s military conflict with Ukraine are among the reasons why the global economy is in jeopardy, adding that the “worst-case” scenarios could may happen.
In a statement, IMF chief economist Pierre-Olivier Gourinchas said: “The world could soon be on the verge of a global recession, just two years after the last recession.” The expert added that the current environment suggests that “the probability that the US economy can avoid a recession” is “quite narrow”.
He added: “The world’s three largest economies, the US, China and the eurozone are stalling with important consequences for the global outlook.
In particular, the Chinese economy, which has been heavily affected by the blockade strategy during the Covid-19 pandemic and the debt crisis caused by real estate, is expected to grow at 3.3%, down 1 ,1 percentage point from previous estimates.
The IMF also downgraded Germany’s 2022 growth outlook from 0.8 percentage points to 3.8% as supply chain bottlenecks continue to disrupt the post-pandemic recovery in an economy dependent on the economy. export.
In addition, the IMF said its forecast was “extremely uncertain” because of soaring food and energy costs, destabilizing economies and households globally.
Further monetary tightening may be needed as prices soar and people’s lives fall into disarray. In advanced economies, inflation is expected to level off at 6.6%, although the US and Germany have recorded higher monthly interest rates compared to the same period last year.
A “reasonable” worst-case scenario involves Russia cutting off all energy to Europe with Russian energy exports falling by another 30%. That could slow growth to 2.6% this year and 2% next year. In such a case, growth would hover around zero in Europe and the US. Only five times since 1970, including during pandemics, has global growth fallen below 2%.
The turmoil engulfing global supply chains has been instrumental in increasing inflation globally, especially in advanced economies like the US and Germany. Inflation continues to be pushed up by rising fossil fuel prices, which have almost doubled in the past year, and soaring food prices, especially in sub-Saharan Africa.
Inflation in developing economies can reach well above 9%, although again many developing countries have reached this level and have seen rates rise well above that.
According to Kinhtedothi.vn
