The International Monetary Fund (IMF) Managing Director, Ms. Kristalina Georgieva, has warned about rising recession risks as the lender downgrades its growth forecast for next year and expects a global output loss of about $4 trillion between now and 2026.
Georgieva, who expressed the concern in her speech at Georgetown University in Washington D.C on Thursday ahead of the IMF-World Bank annual meetings this month, lamented that “in less than three years we lived through shock, after shock, after shock.”
The development finance expert cited the Covid-19 pandemic, Russia’s war in Ukraine and climate disasters that have exacerbated inflationary pressures and led to food and energy prices soaring, causing a cost-of-living crisis.
She said: “Most economists, including at the IMF, thought the recovery would continue, and inflation would quickly subside — largely because we expected vaccines would help tame supply side disruptions and allow production to rebound.
“But this is not what happened. Multiple shocks, among them a senseless war, changed the economic picture completely. Far from being transitory, inflation has become more persistent”, Georgieva added.
As expected, as the threat of a global recession is growing most central banks are focusing their monetary policies on bringing down soaring inflation rates by aggressively hiking interest rates.
The Central Bank of Nigeria (CBN) had during its last MPC meeting increased benchmark interest rate (MPR) from 14% to 15.5%.
