Could the Iran war trigger the next debt shock?
Summary
Borrowing costs are at their highest in nearly 20 years because investors want bigger returns due to worries about the war in Iran raising oil prices and inflation. The International Monetary Fund says global debt could reach levels last seen during World War Two, causing higher costs for loans and everyday goods.Key Facts
- Borrowing costs in big economies are at their highest in almost two decades.
- Investors are avoiding government debt and asking for higher returns.
- The war in Iran is causing concerns about high oil prices and inflation.
- The International Monetary Fund warns global debt may approach World War Two levels.
- The United States influences worldwide borrowing costs.
- Higher borrowing costs mean more expensive mortgages, car loans, and credit for consumers.
- Businesses face increased costs that may be passed on to shoppers.
- Developing countries borrowing in dollars face increased budget pressures.
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