Ukraine invasion: IMF warns of recession

The International Monetary Fund said it will submit Ukraine’s $1.4 billion emergency funding request to its executive board early next week, the IMF said on Saturday.

And it said countries with close economic ties to Russia are also at risk of shortages and supply disruptions. It is negotiating with neighboring Moldova for aid options.

“The ongoing war and accompanying sanctions will also have a severe impact on the global economy,” the IMF said.

Following Friday’s meeting led by Managing Director Kristalina Georgieva, the IMF said there were dire economic consequences in the region. Energy and wheat prices have surged, compounded by the impact of inflation from the pandemic and global supply chain disruptions.

“Price shocks will have an impact worldwide, particularly on poor households where food and fuel make up a larger share of costs,” the IMF said in a statement. “If the conflict escalates, the economic damage will be even more severe.”

The IMF said the impact of sanctions on Russia would also spread to other countries.

Monetary regulators around the world will have to carefully monitor rising prices in their countries, and policies need to be put in place to protect economically vulnerable households.

Ukraine, where airports are damaged and now closed, According to the IMF, will face significant reconstruction costs. The organization said earlier this week the country has $2.2 billion available between now and June from a previously approved contingency agreement.

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