The CEO of the Corum Center for Strategic Studies, Tariq Al-Rifai, said there are 3 main reasons behind the market turmoil and growing investor panic, which include high interest rates, disruption of global supply chains, and the Russian-Ukrainian war.
In an interview with Al-Arabiya, Al-Rifai claimed that the US Federal Reserve in the past saw that the rise in interest rates was temporary, but it has changed that view and is trying to accelerate the rise in interest rates.
He explained that the second reason was the disruption of supply chains and renewed closures in China also raises investor concerns and the third reason is the continuing repercussions of the Russian-Ukrainian war, which increases the risks on financial markets.
He pointed out that the Nasdaq index has dropped nearly 25% since the beginning of the year so far.
Regarding the magnitude of these fluctuations in the markets, Al-Rifai predicts that the fluctuations will remain high through the summer period, only to calm down in the third and fourth quarters of quest’year.
Al-Rifai said the US economy contracted in the first quarter of questyear, while expectations point to an economic slowdown in Europe, which leads to a decline in oil demand.
He revealed that there are many factors that indicate an economic downturn, but we have to wait until the end of the second quarter of questyear to confirm the existence of a recession.
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