© Reuters. FILE PHOTO: The World Financial institution logo is seen on the 2023 Spring Meetings of the World Financial institution Group and the World Financial Fund in Washington, U.S., April 13, 2023. REUTERS/Elizabeth Frantz/File Describe
Hold on to your hats, folks! World Financial institution chief economist Indermit Gill has some concerning news for us. He’s warning that high hobby rates are here to stay, and we won’t be seeing them come down anytime soon. This could mean serious trouble for developing countries.
Gill isn’t pulling any punches – he’s talking about steep debt servicing costs, high debt burdens, and slowing enhance in quite a bit of countries. It’s got him concerned about the possibility of a brand fresh debt crisis and the risk of contagion when countries default.
But don’t panic just yet. Gill doesn’t think a debt crisis is imminent, and he sees promising inflation trends in developed economies. However, he’s keeping an eye on present shocks – particularly in commodities markets – which could potentially push inflation back up and keep the pressure on central banks to maintain those high rates.
