Global recession looms over due to Russia-Ukraine conflict

Brussels/Washington: The US economy slide in the second successive quarter was announced on Thursday. It was notified within 24 hours that inflation had flared up even in the Eurozone. Germany, the leading European economy, has reported a zero economic growth rate for the second quarter. These successive statistics indicate that recession is looming over the global economy.

Moreover, the US administration announced the economic figures on Thursday. According to that, there is a decline of 0.9% in the US GDP. This is the second successive quarter when a decline is reported. A decline of more than 1.5% was reported in the US economy for the first quarter from January to March. According to the global criteria, the economy is considered to be in recession when a decline is reported in the economic growth rate of a country for two successive quarters.

However, it is being revealed that there are different views in the United States over this. President Joe Biden, his colleagues in the administration and US agencies, are not willing to accept that recession has set in. But leading financial institutions, economists and analysts claim that the economy is slowing down. The opposition parties in the United States also have slammed the Biden administration over issues like inflation flareup, interest rate increases and the following GDP decline.

While the US economy is declining, Europe’s economic state is also said to be deteriorating. Per the figures announced on Friday, inflation in the Eurozone, comprising 19 European countries, has risen to 8.9%. Sources informed that this is a record for the Eurozone. The Russia-Ukraine conflict has become the leading cause of this historic flareup. The fuel rates in the Eurozone have increased by nearly 40% and the food grain prices also have increased by 10%. Indications are that the Eurozone will also have to face recession because of this rising inflation.

Germany, the leading European economy, has reported a zero economic growth rate for the second quarter. Germany is known as the economic engine of Europe. Analysts have expressed a concern that stalling of the German economic growth will reverberate even in the economies of other European countries. As the US and European economies are on the brink of recession, the global economy also may have to face the consequences.

The International Monetary Fund (IMF) has published the second report, ‘World Economic Outlook’. The report predicts that the future of the global economy has become dark and uncertain. The IMF has warned that the global economy, which maintained an economic growth rate of more than 6% in 2021, will decline to 3.2% for the current year.