BANGKOK: The head of the IMF Kristalina Georgieva warned on Thursday that the global economy is facing a new test of resilience due to escalating conflict in the Middle East.
"This week global resilience is tested yet again by the new conflict in the Middle East," Georgieva said during a livestream of the "Asia in 2050" conference in Bangkok.
"This conflict, if proven to be more prolonged, has obvious potential to affect global energy prices, market sentiment, growth and inflation, and place new demands on the shoulders of policymakers everywhere," she added.
The United States and Israel began launching strikes against Iran on Saturday, killing its supreme leader and sparking a wave of retaliatory attacks across the Gulf.
The conflict in the resource-rich region has sent global oil prices soaring, and markets have been thrown into turmoil.
"We are in a world of more frequent, more unexpected shocks and we have been warning our membership for quite some time that uncertainty is now the new normal," Georgieva said on Thursday.
"We are potentially in a prolonged period of flux."
Energy security was "at stake" for most of Asia, she told the conference in Thailand's capital, noting the markets have fluctuated "like a roller coaster over the last couple of days".
"So the sooner we see the end of calamity, the better for the whole world."
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