Updated 2022 Global Market Outlook. As central banks accelerate monetary policy normalization, the risk of a policy mistake is rising, as are potential recession risks.

Global Market Outlook

December 6, 2021

Continuing the Climb

While the world maintains its focus on the battle against Covid-19, there are reasons for optimism in the months ahead. But as we continue the climb past peak growth and peak policy accommodation, many risks to the outlook remain.

Outlooks

Macroeconomic

Life After Peak Growth and Peak Policy Accommodation

Above-potential growth will persist in an uneven and multi-layered recovery.

Fixed Income Market

Hawkish Central Banks to Pressure Rates Higher

Increases in short-term yields are likely, though long-term yields will remain anchored.

Equities Market

Earnings Growth to Boost Equities Despite Market Volatility

European equities will benefit from more attractive valuations and a skew toward cyclicals.

Investment Themes

Fixed Income

Getting the Most Out of Fixed Income

Income, liquidity, and diversification goals are still achievable in a low-rate world.

ESG

Keeping Pace with the Climate Transition

The transition to a low-carbon economy could occur faster than investors may think.

China

Why It’s Time to Reconsider Your China Exposure

The size of the market and the magnitude of the opportunity require a dedicated China approach.

Quick Take

Global Chief Investment Officer, Lori Heinel, CFA discusses the three themes investors should keep an eye on in 2022.

Video (01:43)

Meet the Authors

Lori Heinel, CFA

Global Chief Investment Officer

Read Bio

Gaurav Mallik

Global Head of Portfolio Strategy

Read Bio

Simona M Mocuta

Chief Economist

Read Bio

About the Outlook

As investment challenges grow more complex, State Street’s Global Market Outlook was created to alert investors to portfolio risks and opportunities in the coming year, based on the research of our investment teams. Research on near-term and longer-term market issues is at the heart of who we are as investors. It drives the kinds of outcome oriented portfolios we create for clients, drawing on the full range of our indexed and active solutions, as well as our asset allocation expertise.

Prior Outlooks

2021 Mid-Year Update

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