International Monetary Fund (IMF) today he warned that renewed geopolitical tensions on Middle East threatened global economic growth and encouraged inflation, because the fragile truce between Iran and the United States of America threatens to collapse after new attacks by both sides.
In the report on the global economic outlook, which was written before they SAD and Iran announced that the cease-fire is no longer in effect, the IMF indicated that the "most immediate risk" to the global economic forecast "stems from developments in the Middle East."
Renewed conflicts in the region "could prolong price volatility, further threaten supply chains, increase prices and strain financial conditions," the report said, according to Politico.
President of the USA Donald tramp said today that the ceasefire with Iran was "finished", after the Pentagon launched major strikes against targets in Iran overnight.
The economic shocks of a renewed conflict in the Middle East "would be extended through further increases in commodity prices, supply shortages and pressure on the exchange rate," the IMF said.
Trump broke the truce with Iran and wants to stop trade with Spain
Oil supplies are depleted, which means they "could reach stress levels if supply disruptions continue," and actions by individual countries to increase them could "further increase global price pressure," the report said.
Food insecurity could "significantly worsen" if disruptions in fertilizer and energy markets continue, particularly in low-income countries in South Asia and sub-Saharan Africa, while higher food and energy prices "could increase the risk of social unrest and domestic political instability", particularly in vulnerable economies, the IMF said.
Global growth is projected to be three percent in 2026 and 3,4 percent in 2027, while inflation is expected to increase from 4,1 percent in 2025 to 4,7 percent in 2026, before falling to 3,9 percent in 2027.
Source: FoNet
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