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It spares no country. Global inflation will go on an international tour in 2022. First driving force behind rising prices: war. The Ukrainian conflict exploded the price of energy across the globe, as Russia remains the second largest producer and exporter of oil in the world. The invasion of Europe’s breadbasket is driving up the price of wheat, and the sanctions against Moscow are depressing countries that depend on Russian imports. Added to the unstable geopolitical context is the end of the pandemic crisis, the vagaries of the weather damaging crops, shortages… In the second quarter of 2022, no sector is spared. The global inflationary crisis is reaching historic levels and the fire is not dying.
UNITED STATES : 6.3%
In a context of global inflation, even a small setback is welcome. In May, the U.S. recorded inflation at 6.3% over the year, up from 8.5% in March, according to the Labor Department. Figures that tarnish the presidency of Joe Biden, who is considered responsible for the price increase. “I want all Americans to know that I take inflation very seriously and that it is my first priority in domestic policy,” the president assured during a conference in Washington on Tuesday, 10.
Measures: As the midterm elections approach, the Democrat defends his program: “My plan tackles inflation and grows the economy by reducing costs for families, giving workers well-deserved raises, reducing the deficit to historic levels and forcing big business and the wealthiest Americans to pay their fair share.”
In the countries of the fifteenth world economy, inflation reached its highest level in twenty years, in March, 7.45%. A social disaster for a country with 43.9% of the population below the poverty line. In an attempt to limit the rising prices, the government has already introduced subsidies to the fuel sector, distribution of fertilizers to compensate for the sanctions against Russia and the increase in the production of corn, rice and beans. , the country’s most important food. .
Measures: to ensure the purchasing power of its people, the president of the republic, Andres Manuel Lopez Obrador, announced that he had entered into a “goodwill” agreement with the private sector to freeze the prices of 24 basic necessities. “It’s not about price control. It is an agreement, an alliance to ensure that the basic food basket is at a fair price,” he said.
A direct consequence of the explosion in oil prices, but also in food, which increased by 2.06% in the same month. At the same time, Brazilian President Jair Bolsonaro decided to exclude Bento Albuquerque, Minister of Mines and Energy from his government due to disagreements over rising fuel prices.
Measures: Brazil continues to raise its key interest rate. For the tenth time since March, Brazil’s central bank completed its write-up of a new point. Now set at 12.75%, it has yet to match the record set in February 2017 (13%). Updates necessitated by the rise in inflation, which reached 12.13% in April, the highest level since October 2003.
No exception for Africa. In Kenya, inflation reached 6.47% in April. Food is the first to be affected, especially those from local crops due to sanctions against Russian fertilizers.
Measures: in an effort to support his people, the president announced a 12% increase in the minimum wage.
Turkey : 69.97%
Absolute record for Turkey. Inflation exploded, reaching 69.97% year-on-year in April, according to official figures. Consequence of the collapse of the Turkish lira, but also of the increase in energy prices. However, the country has not raised its policy rate since the end of 2021. Worse, some independent economists accuse the official statistics agency of grossly understating inflation figures. The Inflation Research Group (Enag) estimates Turkey’s one-year inflation at 156.86%. Big hole…
United Kingdom: 9%
For 30 years, British life has never been so expensive. And the situation should not improve. Worse, according to Bank of England forecasts, inflation could reach “just over 10%” by October 2022. In May, inflation reached 9% year-on-year.
Measures: The Bank of England raised its key interest rate by 0.25 basis points to 1% on Thursday 5 May. This is the fourth increase by the Bank of England to counter the record high inflation that is undermining Britain.
The federal institute Destatis announced record inflation of 8.7% over a year in May in Germany. This is an increase in consumer prices of 0.1 points compared to March. Inflation has never been this high since the country’s reunification in 1990. Overall prices rose by 0.8% in April. Stopping energy imports could push the bill up to 10% by 2022.
Measures: the one, spectacular, the reduction of the fuel tax and the almost free public transport for three months. Germans travel by public transport at a cost of 9 euros per month.
According to a report on Europe, published by the International Monetary Fund (IMF), inflation in Russia should exceed 17.8% in 2022. And it is the “backbone” of Moscow that is under attack: ” Germany and many EU countries are actually have begun to wean their economies off Russian energy sources. According to the IMF, demand for Russian oil and natural gas could fall by 60 to 70% in the next few years. Estimates corresponding to data from the Russian Central Bank dated April 21, 2022. Analysts estimate, that inflation should reach 22% this year as a result of sanctions imposed by Western countries against Putin’s policies.
Measures: “We have to create a (new) infrastructure, we have the funds, but it will also take time. Difficulties arise in all sectors, both in large and small companies”, announced Elvira Nabioullina, president of the central bank in front of the Russian deputies.
Things are going well for the Land of the Rising Sun. Over a year in March, consumer prices rose by only 0.8% – a figure that, however, excludes fresh produce and energy. Overall, inflation is at 1.2% and should rise to 2% in the coming months.
With the return of covid and health restrictions, China is also seeing inflation accelerate in its territory. In April, the consumer price index rose 2.1% over a year, compared to 1.5% in March, according to the National Bureau of Statistics. Over the month, prices rose by 0.4%, which according to economists is the sharpest acceleration in global inflation since the end of 2021. The price increases are a direct result of the new wave hitting the country for a few months, due to shortages due to panic buying by the local population.
Measures: they are 33 in number, taken by the State Council Executive to “stabilize the economy”. Xi has ordered government departments to respond by the end of May, and the State Council is assigning task forces in 12 provinces to oversee the local work. chinese style…
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- Inflation is burning down all stock markets