Ten economic trends that are strong but even growth for 2022

The economy made a Sensational Transformation from recovery to development last year amid an ongoing Storm from COVID. In the middle of this transition, as a Wealth Manager I believe the global economy may slow down in 2022, the geopolitical risk will continue to pushes in 2022. Fear of raising the rate and unequal balance of demand and supply continues to slow down the global economy. But there are still positive factors that may drive the economy in 2022.So lets have a look at the top 10 economic Trends of 2022 which are strong

  1. Emerging market debt crisis leaving a very low possibilities.

Emerging market borrowing cost is rising since 2020 Pandemic but many countries covered all short term payment that needs to be done through accountability management program which reduces the cross of liquidity driven defaults in the future which is a positive sign for the global economy.

  1. New waves of Covid will not impact the retrieval of economies.

Even if new waves come in 2022, it will or have very little impact on the economy. Majorities are used to it and waves of Covid faces transition from Pandemic to endemic.

  1. Relief in oil prices may come in 2022.

Already in the beginning of 2022, the crude and Brent oil faces surge during global war and hit prices near to year high. Now as soon as tension decreases the crude may start to fall and settle $ 60- $ 80, which is a positive sign for the economy.

  1. The unemployment rate may improve in 2022

As soon as asset prices are shifting towards consumer prices and GDP of developed and Emerging Nation picking pace there are strong chances of improvement in unemployment rate through out the globe.

  1. Interest rates of central bank may tighten riskier assets in 2022.

The central bank throughout the world starts tightening policy and hinted at raising rates which may tight the speculated assets and riskier asset in the coming time. It will again boost investors towards the government scheme and many government small saving schemes will get benefit from it.

  1. Fiscal deficit of policymakers may improve in 2022.

Due to Pandemic, policymakers faced weird situation and to control things they have to Widen the gap of what they are gaining and what they are spending. But now as Pandemic is in transition towards endemic now policy makers may narrow their deficit in the coming time which is the biggest course of worry now.

  1. The policy maker may prevent housing crash and financial crisis.

The housing market looks more in a bubble and with free flowing money around the globe there are more possibilities of financial crisis as well. But central banks have now started tightening their monetary policies which may prevent the housing crash and financial crisis in the future.

  1. The geopolitical tension may plunge in the coming time.

The global tension that escalates between Russia and Ukraine may plunge soon. Russia is the third largest producer of crude in the world but with other Nation fulfilling demand for crude settling the future crisis of oil.

  1. The government debt / GDP may decrease in 2022.

The debt gap which increased throughout the world may start decreasing in 2022 as many developed nations already started repayments. This will bring down the escalated levels of debt / GDP.

  1. Inflation may cool down in 2022.

As soon as central banks started tightening monetary policy the tension of inflation which is escalated and sitting at 30y high will come down again in the zone of 2% -4%, the target which is given by central bank to control economy.

Conclusion

The economy is continuously facing turbulence in Demand / Supply. The foremost key thing to watch as a Wealth Manager for me is Central Bank monetary policies & update on interest rates. One needs to keep a bird eye view on this for further assessments.



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Disclaimer

Views expressed above are the author’s own.



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