(June 7): The World Bank cut its forecast for global economic expansion in 2022 further, warning that several years of above-average inflation and below-average growth lie ahead with potentially destabilizing consequences for low- and middle-income economies. “The world economy is again in danger,” President David Malpass said in the foreword of the latest edition of the lender’s Global Economic Prospects report released Tuesday. The world economy expanded 5.7% in 2021 after the Covid-19 pandemic triggered the deepest global recession since World War II. Accelerating inflation and slowing growth have raised World Bank officials’ concerns that the global economy is entering a period of stagflation reminiscent of the 1970s. With emerging and developing economies’ debt at multi-decade highs, “the associated rise in global borrowing costs and exchange-rate depreciations may trigger financial crises, as it did in the early 1980s,” the World Bank said.
