GLOBAL ECONOMIC GROWTH AND THE IMPACT OF INFLATIONARY PROCESSES ON THE COMMODITY MARKET

The past year 2022 was one of the most unstable years of the 21st century for the whole world. Rising inflation, the consumer price index, a decline in the global growth index, and all this had global consequences for the commodity market and the entire sector of the economy. The war in Ukraine is a human tragedy for the people of Ukraine, but its economic consequences are global. Within weeks of its outbreak, oil prices rose by more than 30% and European natural gas prices by more than 60%. Food and metal prices also rose sharply. This increase occurred against the backdrop of a significant rise in prices in 2021, which significantly exceeded pre-pandemic levels. The business cycle has a significant impact on commodity price fluctuations. During periods of economic growth, when demand is high, prices tend to rise. Conversely, during recessions, when demand is low, prices tend to fall. In recent years, however, a number of factors have disrupted this trend. Global trade conflicts, the COVID pandemic, the war in Ukraine, central bank interest rate hikes, and currency fluctuations have all contributed to disrupting these patterns. Global growth was 6.0% in 2021, 3.2% in 2022, and 2.7% in 2023. Excluding the global financial crisis and the severe phase of the Covid-19 pandemic, this is the weakest growth profile since 2001. Global inflation was 4.7% in 2021. It is expected to rise to 8.8% in 2022, but will decline to 6.5% in 2023 and 4.1% by 2024. In October 2022, the consumer price index increased by 0.4% against expectations of 0.6%. Excluding volatile food and energy prices, core CPI increased by 0.3% month-on-month after rising by 0.6% in September. In October, the CPI rose by 7.7% year-on-year, down from 8.2% in the previous month, as core inflation fell below 8% for the first time since February. Also, the global money supply is sharply declining and affecting demand. Weakening demand threatens to reduce inflation and even deflation. The risk of deflation is much higher than the risk of inflation. In general, the situation is difficult and over the past year, everyone has felt it, including Ukrainians, who, despite the war, with an unstable economy, have to adapt to in some cases doubling the prices of everyday goods, Europe, which has received a large number of refugees, which has destabilized their economy and whose citizens have also felt changes in oil and natural gas prices, and the whole world.