World Outlook

The War in Ukraine Hurts an Already Struggling World Economy

Updated: May 6, 2022

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From an economic perspective, the war has destroyed Ukraine’s economy and has severely damaged Russia’s as well. However, the war’s impact will not be confined to these countries. The conflict has added new risks to a world economy that was already struggling with rising inflation, bottlenecks in supply chains, and the lingering effects from the pandemic.

The immediate consequences of the war on the global economy will be rising inflation, weaker real GDP growth, and a disruption to global financial markets. The extent of these impacts will depend on the length of the war and whether it spreads beyond Ukraine’s borders.

  • Overview
  • Latin America
  • Europe
  • Asia-Pacific

Key findings


The world economy will expand by 3.5 per cent this year—down from the 4 per cent gain anticipated before the beginning of the war in Ukraine.


Oil, natural gas, and other commodities are the main links between the war and the world economy.


Although hurt by the sanctions implemented by the Western world, Russia’s economy is likely earning enough revenue from energy exports to keep its war machine going.


Most countries were struggling with inflation prior to the war, and the sanctions placed on Russia will add even more to the upward trend in consumer prices.

Previous releases


Some Semblance of Normalcy

After 2020’s devastating drop in economic activity, the global economy is now expanding at a healthy clip. But the recovery has been—and will continue to be—uneven.

Impact paper  |  20-min read
October 29, 2021

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