The risk of a global recession has increased recently said President of the World Bank David Melpass, "TASS" reports citing his speech at the Atlantic Council in Washington.
Asked whether the risk of a global recession has increased over the past three weeks, he said:
Yes. But there is always a risk of recession. What we are seeing is a global change.
The head of the World Bank pointed out that the yield on two-year Treasury bonds fell "very sharply" in March.
He cited the "fragility of the system" that arose against the background of bankruptcy and problems of some banks in the USA as the reason for this.
Stagflation should be replaced by more output at lower interest rates, which will allow for future growth, he added.
What is a recession?
The world is experiencing a period of a significant decline in economic activity at the moment. A recession usually leads to a decline in production and investment, business profits, and an increase in unemployment.
The global financial crisis of 2007-2009 reduced economic growth worldwide by almost 4%.
In some countries, including Britain, France, and Germany, the convention is that two-quarters of negative GDP growth indicates a recession.
But many economists consider this definition too narrow. Japan's Cabinet uses several indicators to define a recession, including factory output, retail sales, and employment.
In its January report, the World Bank warned that global economic growth will slow to 1.7% this year amid tightening monetary policy by a number of countries and supply chain disruptions.
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