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Global Economic Outlook
- With global monetary tightening in motion amid exceptionally high inflation, the world economy is entering a slowdown. There is a chance of a growth recession or even something worse.
- Signs of normalization in global supply chains have been modest. Firms are now revisiting such arrangements with an eye on shortening and simplifying them.
Emerging Markets Outlook
- Risks of further lockdowns under China’s zero-COVID policy reignited worries in Q2 around global supply chains, growth, and inflation.
- However, June data implied a material increase in activity at the end of the second quarter, indicating a favorable start to the second half of 2022.
Global Capital Market
- The circular risks surrounding inflation, interest rates and economic growth create a difficult backdrop for equity markets, even with the negative returns already witnessed year-to-date.
- The prospects for fixed income are more balanced, but vary dramatically by sector, credit quality and maturity.