The global economy has entered 2022 in a weaker position than previously expected because of the new variant of coronavirus which has forced countries to impose restrictions – as per the International Monetary Fund. The emergence of new variants can induce renewed economic disruption. Uncertainty around inflation and policy path is expected due to supply chain disruptions, localized wage pressures, and energy price volatility.
High geopolitical tensions and ongoing climate crises have further paralyzed the global economy. Geopolitical tensions such as the ongoing conflict between Ukraine and Russia could have economic repercussions globally. The world feel is feeling the pain of economic fallout due to climate emergency, thus investing in climate policies remain imperative to reduce the risk of catastrophic climate change.
Retail inflation in India has risen to 6.01 percent in January 2022 and is likely to stay elevated till April. In such a scenario, analysts expect the RBI should keep the key policy rates unchanged through the first half of 2022. This will encourage employment, investment and accelerate post-pandemic growth.
