Forecasts Quarter 1, 2021

Chief Economist
Portfolio Manager

Global Economic Outlook

  •  After an extraordinary contraction in 2020, the global economy will likely bounce back sharply in 2021 as vaccine rollout allows pent-up demand to materialize and supportive monetary and fiscal policies aid the recovery.
  • The powerful cyclical recovery likely lifts inflation almost everywhere, but large output gaps will cap the rise.

Emerging Markets Outlook

  • Emerging markets will benefit from improved global demand and the rebound in commodity prices, although the pace of recovery will vary greatly across countries.
  • The COVID crisis likely accelerated shifts in global supply chains, but the full impact will take years to fully materialize.

Global Capital Markets

  • Important forces across macroeconomic, political and public health dimensions continue to create tensions, but benign risk indicators and a mostly constructive outlook characterize our multi-asset portfolio positions.
  • Despite losing some important support mechanisms alongside dramatically tightened credit spreads, credit assets across both investment grade and high yield markets remain attractive.