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Persistently high food, energy prices could lead to stagflation, World Bank warns
Supply chain issues, energy, Russia-Ukraine war, ‘3 drivers’ of inflation: Expert
Potomac Wealth founder and president Mark Avallone discusses the Federal Reserve and inflation.
The Russian war in Ukraine has sent the global cost of food and energy soaring, and costs are expected to remain elevated in the coming three years, the World Bank said in a grim economic forecast this week.
The Washington-based institution said there is a risk that high commodity costs lasting until the end of 2024 could lead to stagflation, the 1970s-style economic phenomenon characterized by persistently high inflation and high unemployment.
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Over the past two years, the world has seen the biggest increase in energy prices since the 1973 oil crisis, and the largest jump in food and fertilizer prices since 2008, according to the World Bank's latest commodity markets outlook. Although the costs of food and energy may cool slightly from their current levels, they are expected to remain above the past five-year average until at least 2024.