Global inflation could be peaking, the head of the International Monetary Fund has said, but she warned that consumers were at risk of facing persistent pressure from rising living costs due to a breakdown in world supply chains.

The Guardian reports that Kristalina Georgieva, the IMF’s managing director, said there were signs the global surge in consumer prices since the COVID pandemic and exacerbated by Russia’s war in Ukraine was close to its apex.

However, the head of the Washington-based fund warned that a fragmentation in global manufacturing supply chains could make it harder to push measured inflation rates back down to the levels seen in recent years before the COVID pandemic.

“We actually think inflation is going to be harder to bring down to the desirable level of around 2%. Why? Because the drivers of deflation are not only supply [and] demand disruption, but also a changing cost structure that comes from the realization that, no more, we make economic decisions only on the basis of cost.

“Supply chain security also matters. If we are going to see diversification of supply chains, that inevitably is going to put some upward pressure on prices.”