Threat of a recession
Threat of a recessioniStock

A report by the IMF on Tuesday predicted a looming recession in G7 countries, blaming historic energy costs and an increasingly shaky financial outlook internationally as indicators of economic trouble on the horizon.

The data from the IMF pointed to predictions of downgraded GDP figures among the world’s top economies, such as the US, Europe and China, CTV News said.

The IMF said that China’s slowing economy, continued COVID-19 outbreaks and the Ukraine conflict had slowed the world economy. Higher than predicted inflation, including in the world’s most advanced economies, was at the top of the list of lowered growth predictions, with a strong probability of a G7 recession.

“The world’s three largest economies are stalling, with important consequences for the global outlook. Inflation is a major concern,” the IMF wrote in a blog post. “Despite slowing activity, global inflation has been revised up, in part due to rising food and energy prices.”

Inflation is set to hit 6.6 percent in advanced economies and 9.5 percent in emerging and developing economies, both predictions up nearly a percentage point. Noting that inflation is likely to continue for an extended period at elevated levels, the IMF said that disrupted supply chains and stretched labor markets point to a prolonged period of economic uncertainty.

“Inflation at current levels represents a clear risk for current and future macroeconomic stability and bringing it back to central bank targets should be the top priority for policymakers,” the IMF said.