In late 2021, the Organisation for Economic Co-operation and Development (OECD) forecasted that the global economy would grow by 4.5 percent in 2022, and that consumer prices would rise by 4.2 percent. But due to the Russo-Ukrainian War, the OECD now forecasts that global economic growth will be 1.1 percentage points lower and inflation will be 2.5 points higher.—The Wall Street Journal
What is “global economic growth” and how is it measured?
Global economic growth is the growth in production of goods and services, and it is measured as the percentage growth rate of global GDP.
What are the OECD forecasts for global growth and inflation in 2022?
The table sets out the OECD forecasts for 2022.
With no war, the OECD forecasts that the global economy would have grown by 4.5 percent in 2022, and that consumer prices would have risen by 4.2 percent. But the war brought revised forecasts of 3.4 percent for real GDP growth and 6.7 percent for inflation.
What is the economic model used to understand economic growth and inflation?
The aggregate supply–aggregate demand model is used to understand the forces that bring economic growth and inflation.
Is the Russo-Ukrainian War expected to change aggregate demand, aggregate supply, or both?
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