World Bank Cuts Global Growth to 3.2% on Ukrainian Crisis, Inflation

The World Bank lowered its forecast for global GDP for the current year to 3.2% from 4.1%, in light of the successive crises in the world represented by the war between Russia and Ukraine and high inflation.

World Bank President David Malpass said on Monday that raising interest rates alone would exacerbate an already rising inequality crisis, so central banks need more tools to combat inflation.

The bank stressed that it is preparing for a 15-month crisis response financing program of $170 billion, with $50 billion set aside for use in the next three months.

Malpass indicated that the reduction in the global economic growth forecast is due to an expected contraction of about 4.1% in the economy of Europe and Central Asia, which includes Ukraine and Russia.