G8 ministers see oil prices as threat to world stability

The world’s most powerful economies will warn tomorrow that the spiralling cost of fuel and food pose a threat to the low inflation and strong growth enjoyed by the west for the past decade and a half.

A draft of the communique from G8 finance ministers and central bank governors meeting in Osaka, Japan, will recognise that the boom in commodity prices in recent years now pose a serious inflationary threat, according to a report by the Reuters news agency.

“For a long time the world economy enjoyed a combination of robust growth and low inflation, but it now faces headwinds,” the G8 draft says. “Elevated commodity prices, especially of oil and food, pose a serious challenge to stable growth worldwide … (and) may increase global inflationary pressures.”

Guardian