With Covid related restrictions in well-vaccinated developed market countries being eased and life returning to normal, the global economy will experience peak growth in the months ahead. During this period, households will deploy their excess savings (built up through a combination of fiscal stimulus and an inability to spend in a locked down environment) and enjoy long awaited freedoms. This period of peak growth is driving strong inflation and consensus expectations for higher interest rates. The key question is what happens to growth after this burst of activity. In this Insight, we make the case that growth could return to “normal” more quickly than many expect.
With Covid related restrictions in well-vaccinated developed market countries being eased and life returning to normal, the global economy will experience peak growth in the months ahead. During this period, households will deploy their excess savings (built up through a combination of fiscal stimulus and an inability to spend in a locked down environment) and enjoy long awaited freedoms. This period of peak growth is driving strong inflation and consensus expectations for higher interest rates. The key question is what happens to growth after this burst of activity. In this Insight, we make the case that growth could return to “normal” more quickly than many expect.
With Covid related restrictions in well-vaccinated developed market countries being eased and life returning to normal, the global economy will experience peak growth in the months ahead. During this period, households will deploy their excess savings (built up through a combination of fiscal stimulus and an inability to spend in a locked down environment) and enjoy long awaited freedoms. This period of peak growth is driving strong inflation and consensus expectations for higher interest rates. The key question is what happens to growth after this burst of activity. In this Insight, we make the case that growth could return to “normal” more quickly than many expect.
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