Governor’s statement from the spring meeting of the IMF and the World Bank

On this occasion the regular spring meeting is being overshadowed by the Russian military aggression and its impact on the economy. The impact of the conflict is reaching global proportions. First it was reflected in a rise in energy prices and food prices. It is now increasingly being reflected in economic developments, where it is EU Member States that are most exposed. As a result of the shock to the economy from the conflict, economic growth will be lower than previously forecast, but still solid, while the current assessment is that the impact on inflation will be even larger. Here the impact of the conflict is mainly being evidenced in a further surge in energy prices, which had anyway begun to strengthen at the end of the pandemic, and rising food prices. I should highlight that the fate of EU Member States in this area is also shared by Slovenia.

In addressing the impact of the conflict a particularly important role is being played by international institutions such as the IMF and the World Bank. The meeting is thus emphasising the importance of global cooperation, at the economic and political levels alike.

Banka Slovenije also sees the ongoing process of monetary policy normalisation, to which members of the Governing Council of the ECB have committed themselves in recent months, as an important part of the response to the situation. With the aim of ensuring that rising energy prices and food prices do not pass through into other categories in the future and cause persistently high inflation, Banka Slovenije is also arguing for the planned steps to be sped up over the period ahead.