Global commodity prices registered mixed performance in Q3’2022, with the energy prices increasing the most by 78.9 percent year on year, mainly due to the persistent supply chain bottlenecks coupled with increasing demand for gas.
Below is a summary performance of various commodities:
According to the United Nations, the global economy is projected to expand by between 2.5 and 2.8 percent in 2022, a substantial decline from its earlier forecast of 3.1 percent in May.
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The downward revision is majorly attributable to:
- Pre-existing supply chain disruptions worsened by the ongoing conflict in Ukraine have greatly impacted global food and fuel supplies,
- The persistent inflationary pressures have seen several central banks raise their interest rates with the aim of anchoring inflation, and,
- The rising borrowing costs and worsening liquidity which has continued to worsen conditions in emerging economies at a time when more funding is needed.
As a result of the ongoing disruptions in the supply chain, as well as the imminent debt crisis, emerging economies are anticipated to record subdued growth in the fourth quarter.
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At the same time GDP growth in Sub-Saharan Africa region is expected to weaken, as debt sustainability concerns remain elevated.
The region’s debt to GDP ratio increased to 61.0 percent of GDP in 2021, from 60.0 percent of GDP in 2020 making it less attractive to foreign capital. The significant weakening of the currencies has also increased the cost of servicing debt.