The IMF reduces its 2022 Global Growth Forecast

On Tuesday, the International Monetary Fund forecasted a steep slowdown in 2022 economic growth around the globe as the Russian invasion of Ukraine drives up energy prices and affects the recovery from the COVID pandemic. Now the IMF predicted global growth of 3.6% this year a decline from its 4.4% estimation issued in the month of January and slower than the expansion of 6.1% in the year 2021. After 2023, it estimated global growth to decrease to about 3.3% over the medium term. The IMF in its World Economic Outlook published after Russia invaded Ukraine on February 24 stated: "The war in Ukraine has triggered a costly humanitarian crisis that demands a peaceful resolution."

IMF further informed that The Russian-Ukraine conflict was contributing to already high inflation. It further commented, "Fuel and food prices have increased rapidly, hitting vulnerable populations in low-income countries hardest." Commodity prices increased by the war and broadening price pressures prompted the financial institution to increase its inflation forecast. It sees inflation reaching 8.7% in emerging market and developing economies, and 5.7% in advanced economies. The previous outlooks had been 5.9% and 3.9%, respectively.