It comes as no surprise that – along with the rest of the market – we’ve spent the year closely tracking growth and inflation dynamics, and how they are being influenced by the pandemic. But we haven’t been focused exclusively on these immediate forces, and I’d like to take this opportunity to make available to all clients some of the key research we’ve produced this year which fleshes out how we see the global economy and markets evolving over the long term.
Mapping Decoupling
The US-China relationship hasn’t markedly improved under the Biden administration and, as we’ve been expecting for some time, decoupling is now reshaping the global economy. In this analysis, we examined the size and scope of China and US-led economic spheres to outline the significant challenges that Beijing will face in a world of bipolar competition.
The CBDCs are coming
Even as Bitcoin and its peers dominated fintech headlines this year, the concept of central bank digital currencies (CBDCs) took several steps towards becoming a global economic fixture. With China’s eCNY gaining steam, we looked at whether CBDCs will mark a revolution or become just a sideshow in monetary policy-making.
Pandemic will not be the death of cities
Since its earliest days, we’ve been exploring how the pandemic will shape economies and markets over the long-term. Following on from last year’s Economies After COVID series, our property team this year published a number of reports looking at the future economic role of cities in light of the changes triggered or accelerated by COVID-19, starting with this piece.
Will we start working less?
Even as advanced economies have become richer, average hours worked have stopped falling in recent decades. We examined why in this in-depth report, explaining how productivity gains, technology and a greater emphasis on work-life balance mean we could work less in future, though the 15-hour week predicted by Keynes may remain out of reach.
Is inflation about to spell trouble for the stock market?
We couldn’t complete a list like this without including something on inflation. In this piece we trawl data back to the start of the 20th century to explore the relationship between consumer prices and stock market returns. Despite the fact that inflation is now at levels that have historically meant trouble for stocks, we’re not expecting a slump in the market – but nor do we expect impressive returns in the coming years.
If you do manage to get any downtime between now and 2022, I hope these pieces give some food for thought. Wishing you a restful break and a prosperous new year.