Global | Is this a goldilocks recovery? Consumers will decide
Despite Covid cases rising globally, upside risks to our already relatively optimistic baseline are material. The main risk stems from the estimated $4.7trn pile of excess savings accumulated by consumers in advanced economies that could be tapped to unleash a wave of post pandemic spending.
What you will learn from this report:
- Our baseline estimates advanced economy consumers will spend on average 5% of these savings. But if they splash out even a little more, the 2022 growth outlook will rise considerably.
- Whether consumers view their excess savings as wealth or as income is key to determining the size of the boost to the economy.
- For emerging markets, there is also upside but it is more limited. Although faster global growth is helpful for emerging markets, the associated tightening of financial conditions is a significant offset.
Tags:
Related Services
Post
Firms must brace for higher ‘new normal’ construction material prices
New research by Oxford Economics suggests that construction materials prices have shifted permanently higher due to the shocks of the past couple of years. Project managers and investors should anticipate costs being at least 15-20% higher in 2024 and onwards than in 2021.
Find Out More
Post
New Activity Trackers suggest momentum is waning
After a choppy first quarter of GDP data, our novel Activity Trackers (which incorporate proprietary daily sentiment data from Penta) suggest that economic momentum in EM Asia is on a softer trend in Q2 (at least outside of China) supporting our view of easing underlying inflationary pressures and diminishing appetite for further rate hikes.
Find Out More