The World Bank just slashes its forecast for global economic expansion this year, blaming Russia’s invasion of Ukraine for their outlook shift.
The Washington-based institution cut its estimate for global growth in 2022 to 3.2% from a January prediction of 4.1% (which compares with 5.7% expansion in 2021).
President David Malpass told reporters on a call on Monday that the decline was spurred by a cut in the outlook for Europe and central Asia, which include Russia and Ukraine.
With inflation continuing to soar and The Fed only tip-toeing into its rate-hikes and QT, stagflation anxiety globally is exploding…
The cut in growth has prompted calls for ever more money to be pumped into various economies (which will of course do nothing to tame inflation). As Bloomberg reports, Malpass expects to discuss a new 15-month crisis-response package of about $170 billion to cover April 2022 through June of next year with the bank’s board in coming weeks, with about $50 billion of this amount to be deployed in the next three months.
“This is a continued, massive crisis response given the continuation of the crisis,” he said, adding that the new initiative will exceed the $157 billion mobilized for the initial phase of the Covid-19 pandemic.
Malpass’s comments and plans come ahead of the International Monetary Fund and World Bank spring meetings taking place this week in Washington, where food security, inflation, debt and the shock of Russia’s invasion of Ukraine are set to feature.
For now, all of the 'solutions' to growth problems appear to only make the food security problems worse, but since when have the repeated lessons of the past ever stopped a good spend-fest