Recently IMF, The International Monetary Fund, has seen that global growth will fall from 5.9% in 2021 to 4.4% in 2022. Then following that 2023 would dip down to 3.8%. The Omicron variant took a toll on the end of 2021. It led to increased mobility restrictions and financial market volatility. This is increasing inflation and made it more broad-based than we expected. We anticipate, by the end of the year, for the past unfortunate health outcomes to fall in most countries as we distribute the vaccine and the boosters.
The mess the pandemic left behind a total disturbance to global trade and this had brought us shortages all over the globe, increasing prices for imported consumer goods. Just from the supply shortages that is supposed to decrease 0.5-1% points off the global GDP 2021. This increases the inflation and keeps making it more broad-based, and adding a point. The year 2022 is basically starting closer to the bottom and we have to build our economy back up.
Article:
https://www.weforum.org/agenda/2022/01/imf-economic-outlook-inflation-covid19/
It is interesting to see the impact that the supply-chain has on the world and it highlights how interdependent we are as a world. Supply shortages caused inflation, increasing prices and it is not a problem that is going away soon. Fortunately, these challenges will only help to innovate how the world trades and cooperates with each other.
ReplyDeleteSome countries have seen far worse than our economy over the past couple of years, for numerous reasons. Given the estimated constant decrease in global growth over the coming years, do you think the US government should reach out to other countries struggling in an attempt to assist in COVID and/or other economic relief opportunities?
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