The war is clouding the global economic outlook – whether a ceasefire is possible or not, the head of the International Monetary Fund warned this morning.
Executive Director Kristalina Georgieva said the fund will lower its global economic forecast next week.
“If it wasn’t for this shock, we would be improving global growth,” Georgieva said ahead of next week’s IMF-World Bank meetings. “But now, even our optimism involves a slowdown in growth.”
The global economy had proved resilient in the face of Donald Trump’s decision to impose massive global tariffs last year. In January, the 191-nation IMF upgraded its global growth outlook to 3.3 percent and was poised to do so again when its new forecast was released next Tuesday.
But the war changed everything. The crisis has raised the price of oil and natural gas; damaged oil refineries, shipyards and other energy infrastructure; the disruption of fertilizer shipments that the world’s farmers depend on; and destroy the confidence of traders and consumers.
Georgieva said “growth will be slow – even if the new peace is lasting”.
And he told policymakers to “be careful not to make things worse” with “go it alone” measures such as cutting exports and imposing price controls. “Don’t pour gasoline on the fire,” he said.
AP
