Kristalina Georgieva has warned that the ongoing tensions in the Middle East could create new problems for the global economy.
Speaking on Monday, the head of the International Monetary Fund said the conflict could test how strong the world economy really is. She explained that if the crisis continues for a long time, it could affect global markets, economic growth, and inflation.
Georgieva pointed out that rising oil prices are one of the biggest concerns. She said that if oil prices increase by 10% and stay at that level for most of the year, global inflation could rise by about 0.4 percentage points.
She also warned that ongoing military escalation could disrupt global energy supplies, which would add even more pressure to markets and economies around the world.
Because of these risks, Georgieva urged policymakers to stay alert and prepare for unexpected situations. She said governments need to be ready for different economic scenarios as global tensions and economic uncertainty continue.
