The World Bank expects inflation in some countries to rise longer than expected

The World Bank forecast report showed that inflation will rise in 2022 in almost all countries, and now it is on a downward trend in the coming months, but in some countries it will remain high for a longer period than expected.

According to the World Bank’s World Economic Outlook report: “Inflation rose in 2022 in almost all countries. reached almost 10% in emerging market and developing economies, the highest level since 2008 … and in developed countries it was just above 9%, the highest level since 1982 … and inflation was above the target in almost all countries. from the countries where it was installed.

He added: “The increase in inflation in 2022 reflects a combination of supply and demand factors. On the demand side, a recovery in growth during the initial recovery from the 2020 global recession, as well as the continued impact of previous macroeconomic support, helped maintain price pressures.”

The report highlights that, according to World Bank experts: “On the supply side, shortages in key raw materials exacerbated by Russia’s special military operation in Ukraine have greatly contributed to rising energy and food prices.”

The World Bank stressed that “in some countries, inflation is also stimulated by a serious depreciation of the currency against the US dollar, as well as a tense situation in the labor market.”

Inflation forecasts in 2023

Inflation is likely to ease gradually over the course of the year, World Bank experts said: “Inflationary pressures began to ease in late 2022, reflecting lower demand and lower commodity prices. The proportion of countries with high inflation rates appears to be rising. With significant monetary tightening, slowing economic activity, less disruption to supply chains, and lower prices for many non-energy commodities, both core and headline inflation are expected to ease over the forecast horizon.

The report highlights that “however, in many countries, high core inflation has proved surprisingly robust, indicating that global inflation will remain high for longer than previously expected,” without mentioning these countries.

Source: TASS