After a decade of debt accumulation, higher interest rates and growing refinancing needs have left the global economy increasingly exposed to shocks. And now ongoing conflicts are driving up energy prices, fueling renewed inflationary pressures and revealing dangerous cracks in the existing debt architecture.
WASHINGTON, DC—The world is edging closer to a global debt crisis. The Iran war may have been the spark, but dry tinder has been piling up for quite a while. After a decade of debt accumulation, higher interest rates and growing refinancing needs have left the global economy increasingly exposed to shocks. And with ongoing conflicts driving up energy prices, renewed inflationary pressures are testing the limits of the existing debt architecture.