“2023 will feel like recession ” warns IMF

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The International Monetary Fund warned of a severe global recession if policymakers handled the fight against inflation poorly on Tuesday, downgrading its global growth predictions for the upcoming year.

The conflict in Ukraine has increased the cost of food and energy in response to the coronavirus outbreak, and rising costs and interest rates pose a threat to the global economy as a whole.

In a blog post that accompanied the International Monetary Fund’s most recent World Economic Outlook, economic adviser Pierre-Olivier Gourinchas warned that this year’s shocks will reopen economic wounds that had only partially healed after the pandemic.

The sombre assessment was revealed in the IMF’s carefully regarded World Economic Outlook report, which was released as senior economic leaders from around the world arrived in Washington for the World Bank and IMF’s annual meetings.

“We do believe that inflation will come back into the inflation tolerance band 4 percent in fiscal year 2023-2024, and more monetary tightening is going to ensure that this happens,” said Daniel Leigh, chief of the IMF’s World Economic Studies Division, at a news conference on Tuesday.

“Inflation is still over the central bank objective in India at 6.9 percent (that) were expected for this year and falling down to 5.1 percent,” IMF Chief Economist Pierre-Olivier Gourinchas stated.The economy of the United States, the eurozone, and China are all slowing down in different ways, which has an impact on economies all around the world. Consumer buying power is being reduced in the United States by inflation and rising interest rates, and the property market is stalling as mortgage rates increase.

Due to new sanctions that will go into force later this year, just as the weather begins to become colder, Europe, which has been mostly dependent on Russia for energy, will see huge hikes in the price of oil and gas. China’s economy continues to suffer as a result of the ongoing lockdowns implemented to stop the coronavirus from spreading.

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