Duma Gqubule: Economic woes are setting the scene for another uprising - It is monetary policy masochism to hike interest rates and shoot blanks at world oil prices
With the world economy reeling from a cost-of-living crisis, after two waves of supply-side shocks, central banks are dispensing the wrong medicine that could make the patient worse.
Rising interest rates reduce demand and GDP growth and can tip economies into recessions. But they cannot fix a broken supply chain or reduce the price of oil. With supply chain issues on the wane, the immediate priority should be to reduce geo-political tensions. The West must realise that it cannot achieve regime change in Moscow. The sanctions against Russia are counterproductive and have caused too much pain in the rest of the world. There must be a negotiated end to the war in Ukraine.
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