Global Outlook 2022 | Bullish - selectively
Listen to our first public podcast! (Recorded 22 November 2021)
Olivia Frieser, Global Head of Markets 360
Luigi Speranza, Chief Global Economist
Marcelo Carvalho, Head of Global Emerging Markets Research
Sam Lynton-Brown, Head of Global Developed Markets Strategy
BNP Paribas London Branch | Global Markets
Our Global Outlook for the year ahead:
Global growth: While many see a risk of stagflation, we are more bullish. We expect global growth to exceed both consensus expectations and its historical trend in 2022 and 2023.
Inflation and monetary policy: We expect rising underlying price pressures to pave the way for monetary policy normalisation, but do not expect financial conditions in developed-market economies to become tight. EM central banks are facing greater pressure to raise rates in their fight against inflation and we think this will weigh on growth more heavily, although we see differentiation within emerging markets.
Developed-market strategy: We are positive on developed-market financial markets, expecting higher nominal and real yields, higher equity market prices and stronger high-beta currencies. We expect credit to underperform equities as the tapering of quantitative easing suggests outflows at a time when issuance remains robust, partly driven by capex.
Risks to our outlook: We will monitor the risks to inflation expectations, China’s slowdown and property market, fiscal policy in emerging markets and political events.
We wish you a successful and happy 2022.
The Markets 360 team