{"id":374,"date":"2023-04-15T10:25:57","date_gmt":"2023-04-15T10:25:57","guid":{"rendered":"https:\/\/servpay.ng\/blog\/?p=374"},"modified":"2023-04-15T10:34:14","modified_gmt":"2023-04-15T10:34:14","slug":"the-world-economy-is-entering-a-perilous-phase","status":"publish","type":"post","link":"https:\/\/servpay.ng\/blog\/2023\/04\/15\/the-world-economy-is-entering-a-perilous-phase\/","title":{"rendered":"The World Economy is Entering a &#8220;Perilous Phase&#8221;"},"content":{"rendered":"\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"783\" height=\"392\" src=\"https:\/\/servpay.ng\/blog\/wp-content\/uploads\/2023\/04\/images-23.jpeg\" alt=\"\" class=\"wp-image-375\" srcset=\"https:\/\/servpay.ng\/blog\/wp-content\/uploads\/2023\/04\/images-23.jpeg 783w, https:\/\/servpay.ng\/blog\/wp-content\/uploads\/2023\/04\/images-23-300x150.jpeg 300w, https:\/\/servpay.ng\/blog\/wp-content\/uploads\/2023\/04\/images-23-768x384.jpeg 768w\" sizes=\"auto, (max-width: 783px) 100vw, 783px\" \/><figcaption class=\"wp-element-caption\"><em>Credit: The Conference Board<\/em> <\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Rotimi Ogunsola<\/em> <\/p>\n\n\n<div class=\"wp-block-post-date__modified-date has-text-align-left wp-block-post-date\"><time datetime=\"2023-04-15T10:34:14+00:00\">April 15, 2023<\/time><\/div>\n\n\n<p class=\"wp-block-paragraph\"><strong>The Forecast <\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">According to the International Monetary Fund (IMF) latest warning, the world&#8217;s economy is verging towards low economic growth and high financial risk.<\/p>\n\n\n\n<!--more Read More-->\n\n\n\n<p class=\"wp-block-paragraph\"> Also opined is the chief economist Pierre-Olivier Gourinchas, he stated: <\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\">&#8220;We are\u2026 entering a perilous phase during which economic growth remains low by historical standards and financial risks have risen, yet inflation has not yet decisively turned the corner.&#8221;<\/p>\n<\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">These factors prompted the IMF to cut its prediction for global economic growth by 0.1 percentage points this year and next, to 2.8% and 3% respectively.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In addition, IMF said that there was now a one-in-four chance of global growth falling below 2% this year, something tantamount to a global recession, and which has only happened five times since 1970 (most recently in 2009 and 2020).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>How Accurate are previous Forecasts of Global Growth by the IMF? <\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">According to Yahoo Finance,<br>&#8220;forecasts in the World Economic Outlook, published twice annually by IMF staff, have turned out to be fairly accurate, within a percentage point of what actually happens&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Reality Bitting Hard Globally<\/strong>..<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Already, rate of getting averagely high paying jobs in US, Canada or UK among the top global economy have been on decline or experiencing insignificant positive change. For example, according to Trading Economics on Canada unemployment rate:<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\"> &#8220;the unemployment rate in Canada was at 5% for a fourth consecutive month in March of 2023, remaining close to the record-low of 4.9% observed in June and July 2022, and compared to market forecasts of 5.1%. Most unemployed people had been unemployed for 13 weeks or less (63.4%) and 16% were unemployed for 27 weeks or more&#8221;<\/p>\n<\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">In Nigeria, KPMG has projected that Nigeria&#8217;s unemployment rate will rise to 40.6% in 2023, up from 37.7% in 2022.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Citing slow pace of economic growth, limited investment by the private sector, and low industrialization for the high unemployment rate.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In UK, although, the country has received an upgrade to its economic growth forecast this year 2023 and next, however the forecast is the worst performing economy in the G7 this year, shrinking by 0.3%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Global Banking Sector under Threat<\/strong>..<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The IMF&#8217;s warnings follows the collapse of Silicon Valley Bank in the US and Credit Suisse in Europe, episodes which have raised the prospect of further financial turbulence in the coming months, as the system responds to rising interest rates.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Funds also stated that &#8220;Inflation is much stickier than anticipated even a few months ago. While global inflation has declined, that reflects mostly the sharp reversal in energy and food prices. But core inflation, excluding the volatile energy and food components, has not yet peaked in many countries.&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Supply Chain and Trade Barriers..<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the World Economic Outlook, other worry is that the world is beginning to deglobalise, with many countries unravelling their supply chains and introducing new trade barriers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">These barriers, which are rising faster than ever before, could constrict global productivity, implying weaker growth for the long run.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">These are indeed challenging periods and we hope the global recession would be avoided by renewed and well implemented global cordinated policies.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Rotimi Ogunsola The Forecast According to the International Monetary Fund (IMF) latest warning, the world&#8217;s economy is verging towards low economic growth and high financial risk.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[113,112,111,34,69,74],"class_list":["post-374","post","type-post","status-publish","format-standard","hentry","category-finance","tag-canada","tag-global-growth","tag-imf","tag-nigeria","tag-uk","tag-us"],"_links":{"self":[{"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/posts\/374","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/comments?post=374"}],"version-history":[{"count":4,"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/posts\/374\/revisions"}],"predecessor-version":[{"id":379,"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/posts\/374\/revisions\/379"}],"wp:attachment":[{"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/media?parent=374"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/categories?post=374"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/servpay.ng\/blog\/wp-json\/wp\/v2\/tags?post=374"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}