The past week has brought a new wave of economic crises around the world, fueling fears of recession, job losses, hunger and falling stock markets.

At the beginning of this persecution there is a force so important that it is almost impossible to mention it – the plague. That power has not gone away, confronting policymakers with deep skepticism. Their policy instruments are suitable for normal recessions, not the rare combination of economic growth and inflation.

Major economies including the United States and France also reported the latest data on inflation, revealing that prices of many goods rose faster in June than at any time in four decades.

The grim figures raised the possibility that central banks could move aggressively to raise interest rates as a way to lower inflation – a lesson expected to cost jobs, damage financial markets and threaten poor, indebted countries.

On Friday, China reported that its economy, the world’s second largest, grew by 0.4 percent from April to June compared to the same period last year. That performance – remarkably anemic by the standards of the past few decades – puts at risk many countries that trade heavily with China, including the United States. It encouraged the realization that the world economy has lost its most important engine.

The idea of ​​a slowdown in economic growth coupled with rising prices has revived an ominous term that was common in the vernacular of the 1970s, the last time the world faced similar problems: stagflation.

Many of the problems affecting the global economy were caused by the world’s reaction to the spread of Covid-19 and the economic shock, although they are aggravated by the latest turmoil – the violent attack of Russia in Ukraine, which has subsided. providing food, fertilizer and energy.

“The pandemic has not only disrupted manufacturing and transportation, which was at the forefront of inflation, but also how we work and where we work, how we educate and where we educate our children, international migration,” said Julia Coronado, an economist at the financial institution. The University of Texas at Austin, speaking last week at a conference organized by the Brookings Institution in Washington. “Everything in our lives has been disrupted by this epidemic, and then we continue the war in Ukraine.”

It’s a pandemic that has prompted governments to impose lockdowns to slow the spread, shutting down factories from China to Germany to Mexico. When people stayed at home they ordered more goods – exercise equipment, kitchen appliances, electronics – which made it difficult to manufacture and ship them, causing the Great Depression.

A shortage of supplies led to higher prices. Firms in highly concentrated industries ranging from meat producers to shippers exploit their market power for profit.

The pandemic prompted governments from the United States to Europe to spend billions of dollars to reduce unemployment and reinvestment. Many economists now argue that they overdid it, boosting energy consumption to the point of fueling inflation, while the Federal Reserve waited too long to raise interest rates.

Now in play, central banks like the Fed have moved boldly, raising interest rates quickly to try to stem inflation, even as they raise concerns about a possible collapse.

Given the mishmash of conflicting signals found in the American economy, the severity of any recession is difficult to predict. The unemployment rate – 3.6 percent in June – is the lowest in almost half a century.

But worries about rising prices and recent spending cuts among American consumers have fueled fears of a recession. This past week, the International Monetary Fund cited a lack of consumer spending in reducing expectations for economic growth this year in the United States, from 2.9 percent to 2.3 percent. Avoiding a recession will be “extremely difficult,” the fund warned.

The outbreak is also at the center of an explanation for China’s economic slowdown, which could lead to a slowdown in industrial production and reduce interest in global exports, from cars made in Thailand to soybeans in Brazil.

China’s zero-Covid policies have been accompanied by Orwellian lockdowns that have stifled business and life. The government is showing determination to keep the doors closed, affecting 247 million people in 31 cities that generate $4.3 trillion in annual economic output, according to the latest estimates by Nomura, a Japanese security firm.

But the resilience of Beijing’s ideology – its willingness to continue to deal with economic damage and public anger – is one of the most important things in a world full of uncertainty.

Russia’s invasion of Ukraine has added to the unrest. International sanctions have blocked most oil and gas sales to Russia in an effort to force the country’s powerful leader, Vladimir V. Putin, to step down. The global recession has caused electricity prices to rise.

The price of a barrel of Brent crude oil rose by almost a third in the first three months of the strike, although recent weeks have seen a shift in sentiment that slower economic growth will lead to lower demand.

Germany, Europe’s largest economy, depends on Russia for about a third of its natural gas. When a major gas pipeline from Russia to Germany shut down last month, it fueled fears that Berlin could soon run out of electricity. This could have a big impact on German companies as it would lead to supply chain problems and the loss of goods shipped to China.

If Germany loses access to Russian gas – which is coming – it could collapse, economists say. The same fate threatens the continent.

“In Europe, the risk of recession is real,” Oxford Economics, a British research firm, said in a report last week.

For the European Central Bank – which meets on Thursday to stoke fears in the markets – the prospect of a rate cut is adding to an already fraught decision.

In most cases, a central bank that supports an economy that is experiencing a recession lowers interest rates so that interest rates can be raised, lending, spending, and hiring. But Europe is not only facing a slowdown in growth but also inflation, which requires higher prices to cost money.

Raising prices would help the euro, which has lost more than 10 percent of its value against the dollar this year, and raise the price of imports from the 19 countries that use the currency – another driver of inflation.

Adding to the challenge is that traditional banking tools are not designed for this. Balancing the balance between protecting jobs and curbing inflation is difficult in easy times. In this case, inflation is a global phenomenon, which is exacerbated by a war that so far has no restrictions and negotiations, including the mother of all supply problems.

Neither the Fed nor the European Central Bank have any leverage to get Putin to take action. There is no longer a way to clear the remains of stranded ships from the United States to Europe to China.

“Everyone is following the economic situation right now, including central banks, we don’t have a clear answer on how to deal with this problem,” said Kjersti Haugland, an economist at DNB Markets, a Norwegian investment bank. “You have a lot of things going on at the same time.”

The biggest risk is the collapse of poor and middle-income countries, especially those struggling with huge debts, such as Pakistan, Ghana and El Salvador.

As central banks tighten credit in rich countries, they have encouraged investors to leave developing countries, where risks are greater, instead fleeing to solid assets such as US and German government bonds, which are paying slightly higher interest rates.

This outflow of capital has increased borrowing costs in countries from sub-Saharan Africa to South Asia. Their governments are facing pressure to cut spending as they send loans to creditors in New York, London and Beijing – even as poverty grows.

Currency outflows have reduced the value of money from South Africa to Indonesia to Thailand, forcing households and businesses to pay more for imported goods such as food and fuel.

The war in Ukraine has compounded all these problems.

Russia and Ukraine are the largest exporters of seeds and fertilizers. From Egypt to Laos, countries that have traditionally relied on their food for grain have been hit hard by rising prices for staples such as bread.

Globally, the number of people considered to be “food insecure” has doubled since the outbreak began, rising to 276 million from 135 million, the UN World Food Program announced this month.

One of the biggest differences that will determine what’s to come is the one that caused all the problems – the plague.

The return of cold weather to the northern countries could lead to further outbreaks, especially due to the spread of the Covid vaccine, which has left many people at risk, putting new strains at risk.

As long as Covid-19 remains a threat, it will make it difficult for some people to work in offices and eat in nearby restaurants. It will prevent others from getting on airplanes, staying in hotel rooms, or sitting in stadiums.

Since the world’s first public health crisis two years ago, it has become clear that the biggest threat to the economy is the pandemic itself. Although policy makers are now focused on inflation, malnutrition, recession and endless war, the show saves money.

“We are still fighting this epidemic,” said Ms. Haugland, economist at DNB Markets. “We can’t just look away from what’s at stake.”

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