A global recession is not imminent, but brace for rising costs and slower growth, economists say. 

“There will be no sudden ‘after’ of stagflation,” said Simon Baptist, global chief economist at the Economist Intelligence Unit, referring to a surprise recession after a period of stagflation.

As the war in Ukraine and pandemic disruptions continue to wreak havoc on supply chains, stagflation — marked by low growth and high inflation — will stick around “for at least the next 12 months,” Baptist told CNBC last week.

He said that although commodity prices may start to fall from the next quarter, they will still be higher than prior to the conflict in Ukraine. This is due to the fact that Russian supply of commodities will continue to decline.

The pandemic as well as the war in Ukraine have stifled supply of commodities and goods and upended efficient distribution through global supply chains, forcing up prices of everyday goods such as fuel and food.

While higher prices can be painful for household budgets, many areas of the globe are still experiencing slow growth and there is no collapse in job markets. 

In many countries, unemployment levels have fallen to their lowest level in over a decade. 

So, consumers — while wary of a repeat of the last global recession brought on by the U.S. subprime crisis over 10 years ago — need not start preparing for a recession. 

Baptist stated that it was very unlikely that there would be a recession in Asia if the economy has had several periods of low GDP. 

The economist stated that even though the world economy may be in recession, consumers still have plenty of savings and stock up on durable household goods.

“So, to an extent,” he stated. 

Shane Oliver is the chief economist of AMP Capital and doesn’t believe there will be a recession, at least for the next 18 months. 

In a note, he stated that “Yield curves” or the difference between short-term rate and long-term yields has yet to invert or warn about recession. 

He believes that the U.S. can avoid a deep bearish market. 

In an effort to fight inflation, the central banks around the world are raising interest rates.

The U.S. central bank announced its biggest rate hike in more than 22 years earlier this month, raising its benchmark interest rate by half a percentage point and warning of further rate hikes. 

Federal Reserve minutes released WednesdayOfficials indicated they were ready to continue with interest rates increases of multiple 50 basis points, in an effort to lower inflation. 

The Reserve Bank of New Zealand raised its cash rate to 2% last week. This central bank has been more tightening than the other banks. The central bank was responsible for it. The fifth rate rise in a row and indicated that the cash rate would reach a higher point than expected.  

Since October’s tightening cycle, the rate has risen 1.75 percent. 

“We are very committed to making sure that actual inflation tracks back to within our target range of 1 to 3% and at 6.9%, we are well north of that … we are resolute in our determination to contain inflation,” governor Adrian Orr said. 

However, there are always risks that inflation control will lead to a recession according economists. 

Stagflation is notoriously hard to control as reining in high prices through raising interest rates could lead to even lower growth.

The longer the inflation remains high, the greater investor markets fear that central banks may not be able tame it without leading to recession. Oliver noted that getting inflation below 2% is going to be difficult, as Fed Chair Powell stated. 

Not everyone is worried.

Vicky Redwood from Capital Economics was a senior economic advisor and said that central banks will be able dial down inflation without creating a recession. 

Planned rate rises in many places — such as in Europe, the UK and the U.S. — should be sufficient to bring inflation back to target, Redwood said. 

“[But]”If inflation expectations and inflation are more stubborn than we anticipate, and interest rates have to increase further, then a recession is most likely,” she wrote in a note. 

She suggested that a Volcker-shock recession could be justifiable. 

The Volcker Shock occurred when Fed Chairman Paul Volcker raised  interest rates to the highest point in history in the 1980s, in an effort to end double-digit inflation in the U.S.