The prices of some of the world’s most important commodities – food, fuel, plastics, metals – are rising more than many consumers can afford, forcing many households to cut spending. And if that trend accelerates, it could trigger a new recession, Bloomberg reports.
Referring to UN data, The agency notes that world food prices hit a record in Februaryas Russia’s operation in Ukraine disrupted supplies from countries that together supply a quarter of the world’s grain and grains and most of the cooking oil.
And in addition, in Europe, electricity bills are skyrocketing due to dependence on Russian energy supplies. Natural gas prices on the mainland are six times higher than a year ago, and electricity is almost five times more expensive.
At the same time, not only raw material prices are affected. According to the article, due to rising energy and food costs, households in developed countries would also have to cut leisure spending such as evening entertainment, vacations, gadget purchases and more.
What will happen next?
That’s what Kenneth Medlock, director of the Center for Energy Studies at the Baker Institute for Public Policy at Rice University (USA) claims. the price surge “is a sign of what could become a recession.”
That, in turn, said James Smith, developed markets economist at ING, based in London “There is little doubt that inflation will remain high for longer.” “Another rise in gas prices would lead to widespread demand destruction,” he added.
(Adapted from RT)
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