The global recovery will slow in the coming quarters as the initial post-lockdown rebound fades and policy support is reduced. At the same time, supply shortages are likely to persist well into next year, which will act as an additional brake on output. We have revised down our growth forecasts for 2022 in almost all major economies and they generally sit below the consensus, particularly in China and the US. Headline inflation will fall across the world next year as many of the temporary factors that have pushed up inflation this year unwind. But underlying price pressures will build in several places, most notably in the US. Despite this, most developed market central banks will be slower to tighten policy than investors currently anticipate.
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