IMF official: World economy at risk of 'Cold War two'

Gita Gopinath

The global economy is teetering on the precipice of a second Cold War that risks wiping out all the trade gains since the fall of the Soviet Union, a senior official from the International Monetary Fund has warned.

Gita Gopinath, the IMF's first deputy managing director, said in a speech yesterday (11 December) that the world was at a "turning point" in tensions between superpowers China and the US that could lead to a global fragmentation along lines of regional support. She said: "While there are no signs of broad-based retreat from globalisation, fault lines are emerging as geoeconomic fragmentation is increasingly a reality. If fragmentation deepens, we could find ourselves in a new Cold War." CBI forecasts no Bank of England rate cuts until at least 2026 Gopinath added that the economic ...