Economists say high inflation will remain a problem in many regions of the world for years to come. According to the 1,405 experts from 133 countries surveyed by the Ifo Institute, global consumer prices are likely to rise by an average of 7.0 percent this year.
In the coming year, the inflation rate must then fall to 6.0 percent and in 2026 it will be 4.9 percent. “Expectations for 2023 and for the coming years are almost the same as in the first quarter survey,” said Ifo researcher Niklas Potrafke on Monday about the quarterly survey with the Institute for Swiss Economic Policy. “We will have to adapt to high inflation rates.”
In Germany, participants expect 5.8 percent this year, in Austria even 7.8 percent and in Switzerland 2.8 percent.
However, in Western Europe (4.9 percent), North America (4.5 percent) and Southeast Asia (4.8 percent), inflation expectations for 2023 are well below the global average: here, too, they are for the current year lower than in the previous quarter 0.4 , 0.5 and 0.3 percentage points respectively. Regions with particularly high inflation rates include large parts of Africa and South America.
East Africa has been particularly affected
The economists forecast the highest inflation for the current year in East Africa at 110 percent. That is 80 points more than expected in the first quarter. In North Africa it is 64 percent – 31 points more than in the first quarter. In South America, on the other hand, the situation has calmed down somewhat. Expected inflation here has almost halved to 23 percent this year.
Inflation was initially caused by the corona pandemic, sometimes leading to factory closures around the world and then significant shortages of materials and raw materials. The second round of price increases started with the Russian war against Ukraine in February 2022. As a result, energy prices in particular rose sharply, which affected many goods and services.
Most Western central banks have responded to the high inflation with sharp interest rate hikes. According to economists, the European Central Bank (ECB) and the US Federal Reserve (Fed) are likely to raise interest rates again this month.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
