World Bank chief warns of global recession
The World Bank’s chief economist has warned that Russia’s invasion of Ukraine might trigger a global recession if food, gasoline, and fertilizer prices rise.
On Wednesday, David Malpass told a US business event that it is difficult to “see how we avoid a recession.”
He also stated that a string of coronavirus lockdowns in China is raising concerns about a slowdown.
His remarks are the latest high-level warning about the growing possibility that the global economy would contract.
“As we look at world GDP… it’s difficult to see how we avoid a recession right now,” Mr Malpass added, without providing a particular projection.
“The mere doubling of energy prices is enough to cause a recession,” he warned.
The World Bank dropped its global economic growth prediction for this year by nearly a full percentage point last month, to 3.2 percent.
Gross Domestic Product, or GDP, is a measure of economic growth. It is one of the most important indicators of how well or poorly an economy is operating, and it is regularly monitored by economists and central banks.
It assists firms in determining whether to expand and hire more workers or to invest less and reduce existing workforces.
Governments also utilize it to guide decisions ranging from taxation to expenditure. It, along with inflation, is a significant indicator for central banks when deciding whether or not to raise interest rates.
