Inflation was already high before the Russia-Ukraine war. This was because governments continue to apply stimulus measures - for political reasons - even when their economies have visibly recovered from the pandemic. This has led to inflation (due to demand). The war in Europe worsened the situation by disrupting energy and food supplies, adding to a supply side inflationary shock.
Drastic measures are needed to bring inflation back down and prevent inflationary expectations from taking root.
“It is very difficult to do that and have a soft landing. There is a considerable risk of doing what you need to do but as a result provoking a recession. It has happened repeatedly in the 60s, 70s, 80s, 90s. That is a risk which we have to anticipate and watch out for. You will have to take that risk because if you do not act against inflation, that will become a very serious problem for the world, " said PM Lee.
https://sgmatters.com/world-has-to-act-against-inflation-before-it-becomes-a-serious-problem-pm-lee/
