Amman, May 5 (Petra) -- The International Monetary Fund warned that a continuation of the war in the Middle East through 2027 would leave the global economy facing outcomes far worse than the "adverse scenario" it is currently experiencing.

IMF Managing Director Kristalina Georgieva said at a conference hosted by the Milken Institute in Washington on Tuesday, "We will see inflation rising, and it is inevitable that inflation expectations will begin to diverge from reality." She explained that "current conditions, with oil prices hovering around $100 per barrel or higher and mounting inflationary pressures, have already triggered the IMF’s adverse scenario." She added that under the "worst-case scenario," global growth would slow to 2.5% in 2026, while inflation would rise to 5.4%, compared with the "baseline scenario," which assumes a short-lived conflict and projects growth of 3.1% and inflation of 4.4%.

Georgieva stressed that the IMF is closely monitoring the gradual impact of the conflict on supply chains, noting that fertilizer prices have already risen by between 30% and 40%, which would push food prices higher by between 3% and 6%. Other sectors could also be affected.

//Petra// AF