US inflation is at a 40-year high and the UK is effectively in recession as demand slows for Chinese-made goods. Prime Minister Boris Johnson, though addressing the British economy, could have been speaking for the whole world when he said in a recent interview that “we’re going to have a difficult period, and we’ve got to be absolutely clear with people it is going to be difficult, and the government cannot solve every problem.”

On the heels of a massive interest rate hike by the Federal Reserve, this week’s episode of “Stephanomics” tackles the bumper crop of trouble facing the globe’s central bankers—not to mention finance and trade ministers. First, host Stephanie Flanders speaks with Bloomberg Chief Economist Tom Orlik, who says the Fed’s 75 basis point hike in interest rates was necessary to help cool inflation, but it doesn’t address the root causes of spiraling prices. To do that, the Fed would have to persuade Saudi Arabia to boost oil production, Russia to stop blocking Ukraine’s wheat exports and Taiwan to produce more semiconductors.

What’s more, the Fed’s move is likely to boost borrowing costs for emerging nations and likely won’t prevent a US downturn, Orlik says. While it may duck one this year, a recession by 2023 “is going to be pretty hard to avoid.”

Next, correspondent Lizzy Burden discusses why the UK may want to brace for a sustained downturn rather than a short one. Consumer confidence has declined to levels last seen in the 1970s and the housing market is cooling. So even if Britain avoids two quarters of contraction, Burden says, “almost every other economic metric is screaming slowdown.”

Finally, reporter Enda Curran reports on how Chinese manufacturers are also feeling the pinch from inflation and rising interest rates faced by their US and European customers. While it hardly qualifies as a trade recession since consumers are still spending, Chinese manufacturers such as Prime Success Enterprises, a maker of pop-up swimming pools for dogs, warn that demand is drying up.

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Why Inflation's Fallout Is Becoming Increasingly Global

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