Inflation in the Netherlands is likely to remain at a very high level next year. In addition, the growth of the economy will almost stop. This is the forecast of the International Monetary Fund, which believes that the current energy crisis in Europe is not temporary, but permanent.
The fund’s new estimates are based on inflation of 12 percent for the whole of this year. Next year inflation could reach 8 percent, according to the International Monetary Fund, the United Nations organization that monitors the stability of the international monetary system. High inflation affects the economy. This year, the economy in the Netherlands is still growing at 4.5 percent, but next year the economy is expected to grow by only 0.8 percent.
The IMF’s chief economist, Pierre-Olivier Gorinchas, says that after the Russian invasion of Ukraine, a “geopolitical reorganization of energy supplies” has begun which is “widespread and enduring”. He describes it as a challenge to ensure that Europeans are not neglected in the cold winter. It is estimated that next year’s winter will be more difficult. Because The war in Ukraine It’s still ongoing, and the chief economist predicts that the current energy supply problems could worsen.
worse than other economists
With his forecasts, the IMF is more bleak than many other economists. For example, the latest estimates from the Central Planning Bureau (CPB) about Prinsjesdag for next year are still 1.5% growth From the economy is possible. The European Central Bank assumed that inflation would fall below 3 percent next year.
It is not only in Europe that inflation is soaring and a recession is looming. The International Monetary Fund also slightly revised its forecasts for the United States and China. Many developing countries are also suffering from a rising dollar. The International Monetary Fund estimates that about a third of the global economy will experience at least two consecutive quarters of contraction this year or next.
What do purchasing power, inflation and average income again mean? Read it in language Our Economics Dictionary.
Gourinchas notes that a previously projected 3.2% global growth for this year should still be possible. However, the fund is softening its forecast for next year. After that, the global economy could grow by 2.7 percent, 0.2 percentage point lower than expectations of 2.9 percent in July.
This may seem like a slight adjustment, but the economist stresses that the picture could be much bleaker. “We estimate that there is a one in four chance that global growth will fall below the historically low level of 2 percent next year.” Moreover, there will be a chance for more than one in ten that the global economy will improve by only 1 percent.
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