The Chief Economist of the International Monetary Fund, Gita Gopinath, has disclosed that the Omicron variant of the coronavirus could cost the global economy $5.3trillion.
Speaking at an event organised by the World Health Organization (WHO), Gopinath warned that the pandemic could turn out more costly than estimated as central banks do not have the space to keep monetary policy loose and interest rates low.
She added that in a situation when the pandemic lasts longer than anticipated, longer supply disruptions will build up inflationary pressures around the world and economies would be exposed to the the risk of stagflation, which has been avoided so far.
Referring to the current Omicron strain, she expressed further that the IMF had simulated the case of what would happen if there were a more transmissible variant than the Delta variant.
