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Warning on Credit Suisse’s economy! Said, ‘The worst phase in the economy is yet to come’

Credit Suisse on World Economy: Brokerage firm Credit Suisse has made many worrying claims in its report regarding the world economy. According to Credit Suisse, the coming times can be very challenging for the world economy. Demand is decreasing all over the world, along with this, the strength of the dollar can have a very bad effect on emerging economies. Due to this, the pressure on emerging economies will increase and inflation in the countries may increase further in the coming time. Along with this, the firm said that the role of central banks of all countries will be very important in the coming times.

Raising the interest rate of central banks will have a bad effect on GDP

Further, Credit Suisse said that the central banks of many large economies have consistently increased interest rates very rapidly to control inflation. This will have a direct impact on the GDP of the countries. It is worth noting that almost every major economy of the world is under a lot of pressure since the Corona pandemic (Covid-19 Pandemic) and Russia Ukraine War.

Big economies like America, Europe, China and India are being affected very badly due to inflation. To curb inflation, the world’s central banks have increased interest rates at the fastest rate since 1979. This can have a direct impact on the global GDP. Earlier it was estimated that the global GDP will be 2.6% in the year 2022, but now it is likely to be 1.6%.

Recession likely in Europe and the UK

Let us tell you that in the 19 countries that come in the Eurozone, inflation is creating an outcry. For the first time, the inflation rate in European countries has crossed 10% (Inflation in Europe). Due to this, the possibility of economic slowdown in this area has increased further. According to the Euro State data released on Friday, in September, the Consumer Price Index in European countries crossed double digits i.e. 10% for the first time.

On the other hand, in the month of August, the inflation rate in Europe was 9.1%. In the UK too, inflation has made it difficult for the common people to live. In such a situation, it is being expressed that the European Central Bank and the Bank of England can increase their interest rates.

Inflation is worse in America and India too

Apart from Europe, there has been an outcry due to inflation in America as well. Inflation in the country has broken the record of the last 40 years. In such a situation, in order to control the inflation rate of the country, the US Federal Reserve has decided to increase its interest rates by taking a big decision.

The Federal Reserve has increased interest rates by 0.75%. After this it has reached between 3 to 3.25%. It is worth noting that the interest rate is the highest ever since the recession of 2008.

In the US too, the inflation rate is 8%. Talking about India, inflation is breaking the back of common people here too. At the same time, there is a lot of pressure on China, the world’s second largest economy. Due to the gap between demand and supply in the market and the lockdown, China’s GDP growth is estimated at 3.5% this year. At present, the retail inflation rate in India was above 7% (Inflation in India). To control the rising inflation in the country, the Reserve Bank has increased the repo rate by 0.50% for the fourth time in a row.

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