Israel-Gaza Conflict Sparks Global Economic Concerns

The International Monetary Fund (IMF) has warned that the global economic recovery is slowing, with a new war in the Middle East threatening to further disrupt an already fragile world economy. The conflict between Israel and Hamas has cast a cloud over the annual meetings of the IMF and World Bank, where policymakers were already grappling with the economic effects of the pandemic and Russia's war in Ukraine. The impact of the Middle East attacks on the global economy is currently limited, but if the conflict were to spread, it could result in a crisis of unimaginable proportion. Oil markets are already jittery, and another spike in oil prices could pressure central banks to further raise interest rates. The IMF has underscored the fragility of the recovery, maintaining its global growth outlook for this year at 3 percent and slightly lowering its forecast for 2024 to 2.9 percent. Europe's economy is caught in the middle of growing global tensions, and the energy transition has taken a toll on European economies. Sub-Saharan Africa is also facing a slowdown, with staggering debt looming over many nations. The IMF has lowered its growth outlook for China twice this year and warned of a potential loss of momentum in the Asian industrial supply chain.