Inflation took off. The cost of living in the Organization for Economic Co-operation and Development – a group of major economies that includes the United States and much of Europe – increased by 9.6% between May 2021 and June 2022. The outlook is equally bleak in developing countries. Economists now fear that the rising figures could portend a global economic slump.

A worrying trend: Inflation has been steadily rising since the start of 2021. In the United States and Great Britain, it has reached levels not seen four decades ago. The OECD inflation forecast for its member countries predicts that the cost of living will increase slightly before starting to decline at the end of the year.

Tighten your belt: Citing concerns about inflation, among other factors such as the war in Ukraine, the International Monetary Fund issued a grim economic forecast. The institution predicts that global gross domestic product for 2022 will contract to 3.2%, a decline of almost half since 2021.

• The European Union pledged on Tuesday to reduce natural gas consumption by 15% to save for the winter. European countries are facing shortages due to the dispute with Russia, a key gas supplier, over the war in Ukraine.
• The Federal Reserve, the US central banking system, raised interest rates 0.75% on Wednesday in an effort to lower prices by dampening demand.
• At least 18 states have moved to send relief payments to Americans, Business Insider reports, though economists fear the grants will fuel demand instead.

Key quote: “The world could soon tip over to the brink of a global recession, just two years after the last one,” wrote Pierre-Olivier Gourinchas, economic adviser and research director at the IMF.