Thomas Catenacci, DCNF
The World Bank cut its global growth forecast Tuesday and warned that the world economy could enter a period of feeble growth and elevated inflation.
Global growth is now projected to decline from its 2021 rate of 5.7% to a lowly 2.9% in 2022, a downward revision from the 4.1% growth it forecasted five months ago, according to the World Bank’s Global Economic Prospects report published Tuesday. The World Bank report further projected growth to remain low through 2023 and 2024 as a result of Russia’s invasion of Ukraine, which has disrupted a wide range of global economic activity.
“The war in Ukraine, lockdowns in China, supply-chain disruptions, and the risk of stagflation are hammering growth. For many countries, recession will be hard to avoid,” World Bank President David Malpass said in a statement. “Markets look forward, so it is urgent to encourage production and avoid trade restrictions. Changes in fiscal, monetary, climate and debt policy are needed to counter capital misallocation and inequality.”
The World Bank also warned the current condition of the global economy “resembles” its economic condition in the 1970s when stagflation ran rampant in the U.S. and worldwide. The organization said, like the 1970s, there are persistent supply disturbances increasing consumer prices, prospects for weakening growth and vulnerabilities in developing economies.
Stagflation occurs when inflation continues increasing as growth declines and unemployment rises, according to consumer financial services firm Bankrate.
“Global inflation is expected to moderate next year but it will likely remain above inflation targets in many economies,” the World Bank said in a release Tuesday. “The report notes that if inflation remains elevated, a repeat of the resolution of the earlier stagflation episode could translate into a sharp global downturn along with financial crises in some emerging market and developing economies.”
The economic downturn is expected to impact both advanced and developing nations, the report added.
The World Bank is a key global financial institution based in Washington, D.C., that focuses on increasing “shared prosperity and promoting sustainable development.”
For licensing opportunities of our original content, please contact firstname.lastname@example.org.
DONATE TO BIZPAC REVIEW
Please help us! If you are fed up with letting radical big tech execs, phony fact-checkers, tyrannical liberals and a lying mainstream media have unprecedented power over your news please consider making a donation to BPR to help us fight them. Now is the time. Truth has never been more critical!
- Biden: Musk’s foreign ties are ‘worth being looked at’ after ‘joint acquisition’ of Twitter with ‘other countries’ - November 10, 2022
- With Republicans poised to take back the House, a key opportunity to reverse Dems’ insanity emerges - November 9, 2022
- Elon Musk offloads nearly $4 billion in Tesla stock as shares continue to tank - November 9, 2022
We have no tolerance for comments containing violence, racism, profanity, vulgarity, doxing, or discourteous behavior. If a comment is spam, instead of replying to it please click the ∨ icon below and to the right of that comment. Thank you for partnering with us to maintain fruitful conversation.