'Reminiscent of the 1970s': World Bank warns of stagflation, recession

Many gas stations ran out of fuel during the oil crisis in the early 1970s. (Wikimedia Commons)
Many gas stations ran out of fuel during the oil crisis in the early 1970s. (Wikimedia Commons)

Warning of “an extended period of stagflation reminiscent of the 1970s,” the World Bank forecast in its latest report that global economic growth will decrease this year, and most countries should prepare for a recession and several years of above-average inflation.

The World Bank had predicted in January that global growth would be 4.1% this year, but that forecast has been downgraded to 2.9% in the report released Tuesday.

And there won’t be a rebound next year, the report said, with growth limited to 3%.

The World Bank said the “global outlook faces significant downside risks, including intensifying geopolitical tensions, an extended period of stagflation reminiscent of the 1970s, widespread financial stress caused by rising borrowing costs, and worsening food insecurity.”

For 25 years, WND has boldly brought you the news that really matters. If you appreciate our Christian journalists and their uniquely truthful reporting and analysis, please help us by becoming a WND Insider!

After a global growth rate of 5.7% last year, the report forecasts a 2.9% level extending through 2024. The World Bank also expects per capita income in developing economies in 2022 to be nearly 5% below the level prior to the COVID-19 pandemic.

World Bank President David Malpass said the “war in Ukraine, lockdowns in China, supply-chain disruptions, and the risk of stagflation are hammering growth.”

For many countries, recession will be hard to avoid,” he said.

If you like WND, get the news that matters most delivered directly to your inbox – for FREE!

Stagflation, a term used to describe the economy of the 1970s, occurs when inflation is coupled with slow economic growth or recession and high unemployment.

Treasury Secretary Janet Yellen told reporters last month before the G-7 finance ministers meeting in Germany that, globally, “higher food and energy prices are having stagflationary effects, mainly depressing output and spending and raising inflation all around the world.”

Content created by the WND News Center is available for re-publication without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact [email protected].

SUPPORT TRUTHFUL JOURNALISM. MAKE A DONATION TO THE NONPROFIT WND NEWS CENTER. THANK YOU!

This article was originally published by the WND News Center.

Related Posts