World Bank lowers global growth forecast to 2.5 percent as Iran war causes energy prices to soar

Growth is now expected to fall to 2.5 percent this year, down from 2.9 percent last year, the World Bank announced.

The U.S. and Israel's war against Iran has caused energy prices to soar, which in turn is causing higher inflation and raising the risk of increased borrowing costs as central banks try to curb price increases.

The World Bank says it is immediately making $60 billion, equivalent to around SEK 575 billion, available to developing countries that have been hit hardest by the economic crisis.

“In response to the current shock, we are providing liquidity where needed,” said World Bank President Ajay Banga - adding that the bank is ready with additional financing “if pressure increases.”