The escalating conflict between Israel and Hamas, marked by heavy bombardment in Gaza City, rising civilian casualties, a power cut to Gaza by Israel, and halted flights to Tel Aviv, is adding strain to an already fragile global economy. This concern was highlighted on Thursday by Kristalina Georgieva, the head of the International Monetary Fund (IMF), and Bruno Le Maire, the French finance minister. They cautioned about the potential impacts on oil prices, inflation, and interest rates, along with “problematic economic consequences” if the conflict expands at a regional level.
In her address at the IMF and World Bank annual meetings on Thursday, Georgieva expressed deep concerns over the economic implications of the Israel-Hamas conflict on a global economy already grappling with weak growth, economic fragmentation, and persistent inflation. The conflict has resulted in over 2,500 deaths including a deadly attack on Jewish civilians. This has triggered fluctuations in oil markets due to Israel’s vow to destroy Hamas and the ongoing siege of the Gaza Strip by Israel despite pleas from the Red Cross for fuel to keep hospitals operational.
The IMF mourned the heartbreaking civilian deaths and warned that it’s too early to fully gauge the economic fallout from this unprecedented attack by Hamas. Amid these uncertainties, Sky’s economics and data editor Ed Conway advised a measured interpretation of these gloomy economic forecasts, including the UK’s expected slowest growth rate among G7 nations.
As innocent civilian casualties increased due to the continuing siege of the Gaza Strip by Israel, Georgieva described the situation as “heartbreaking”. With Hamas still holding hostages, she called upon nations to anticipate such shocks and avoid escalation while focusing on cooperation.
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