World Bank economist warns of rising risk of 1970s & 80s style debt crisis

News

An interest piece while we wait for financial markets to fully kick off for the week.

Japan’s Nikkei have excerpts from an interview with chief economist and director of the World Bank’s Prospects Group Ayhan Kose.

In a nutshell:

  • One of the risks we look at is this higher-than-expected rise in interest rates — so, the much faster tightening of financial conditions.
  • The other risk we look at is the risk of commodity prices being higher
  • and the third important risk we analyze is the risk of further COVID disruptions, the types of disruptions we saw in the case of China. These disruptions are quite important because they translate into the supply-side interruptions, weaker growth, as well as higher inflation.

Here is the link for more detail.

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