IMF warning on the global economy

International Monetary Fund (IMF) Deputy Managing Director Daniel Katz issued a warning, stating that the war in the Middle East could create serious effects on the global economy. Katz noted that these impacts would be felt through inflation, growth, and energy prices, but emphasized that it is still too early to make a clear forecast under current circumstances.

INCREASE IN ENERGY PRICES

Speaking at the Future of Finance event organized by the U.S. think tank Milken Institute in Washington, Katz said that damage to energy infrastructure and potential disruptions in the Strait of Hormuz could seriously affect regional and global economies. "There have been significant increases in oil and natural gas prices over the last 48 hours. This is leading investors to price in inflation and monetary policy responses," he said.

Stating that the economic impacts will depend on the geopolitical situation and the duration of the conflict, Katz warned, "Short-term increases in energy prices do not pose a major problem for central banks, but if persistent shocks and high energy costs destabilize inflation expectations, a response will be inevitable."

News Source: 12punto