The IMF predicts reduced growth globally due to the war

The IMF’s forecasts for the global economy are reduced, due to the war of the US-Israel in Iran and the rise in energy prices.

Amid huge uncertainty the IMF presented three growth scenarios: weaker, worse and severe, depending on the development of the war.

According to the most adverse scenario of the IMF, the global economy is on the verge of recession, with oil prices being formed on average at 110 dollars per barrel in 2026 and at 125 dollars in 2027.

The GDP of the EU will increase by 1.2% instead of 1.8% which was the initial forecast, due to the war, while unemployment will increase from 5.9% to 6%.

A few minutes after the publication of the report, the chief economist of the IMF, Pierre-Olivier Gourinchas, stated that it may already be outdated. He stated, at the same time, to journalists that, with the ongoing energy turmoil and without clear prospect of ending of the conflict, the “adverse scenario” of the IMF seems more and more likely.

For the Greek economy it predicts that it will have a growth rate higher than the EU average, but inflation 3.5% (instead of 2.1%).

Sources: Reuters, Καθημερινή