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The continued threat of new virus waves, and therefore fresh rounds of travel restrictions, suggests that global migration flows could remain subdued for a while yet. However, we continue to doubt that the pandemic will have any major lasting impact on …
16th December 2021
One possible upside of the current labour market shortages in developed economies is that they could push firms towards expanding output by raising investment and productivity instead of relying on cheap labour. However, any gains in productivity may not …
2nd December 2021
Download the PDF for the full report Our monthly Long Run Returns Monitor provides our updated long-term projected returns for major asset classes, as well as a summary of the macroeconomic forecasts which underpin them. All projections in this …
25th November 2021
The pandemic’s most significant economic legacy in India will be a heavily-damaged banking sector that is likely to constrain investment over the years ahead. This underpins our view that the economy could be 5% smaller over the long run than it would …
17th November 2021
COP26 has progressed efforts to fight climate change, but there is still a significant gap between pledges and actual policies. Unless action ramps up this decade, countries may face a choice between accepting the costs of greater global warming or a …
16th November 2021
The UN’s annual climate change conference, COP26, has the potential to be an important milestone but it is just one step along the path required to limit global warming. Accordingly, it will not on its own stop climate change from clouding the long-run …
2nd November 2021
22nd October 2021
Accelerated adoption of renewable electricity will cause demand and prices of coal and natural gas to fall over the long run. While we think the global economy will handle this transition well, there will be some winners and losers depending on which …
15th October 2021
It is a year since we published our “ Economies after COVID ” series, so now seems like a good time to pause and take stock of how our predictions about the legacy of the pandemic are shaping up. There is a still a long way to go until the pandemic’s full …
8th October 2021
Irrespective of how the current problems in China’s property sector are resolved, property construction there is entering a period of structural decline. Among other EMs, the main effects will be felt in metals producers in Latin America and Africa, …
7th October 2021
29th September 2021
While it may take years or decades before the evidence is clear, there are tentative signs that the pandemic has accelerated a shift towards a bigger role for the state in advanced economies. In our “ Economies after COVID ” series last year, we explained …
24th September 2021
The pandemic is likely to inflict lasting damage on potential growth in economies in much of Latin America, Africa and South and Southeast Asia, adding to the structural headwinds that they already faced. However, the risk of permanent scarring in many …
9th September 2021
Climate change is already making extreme weather events more frequent and more intense, which will worsen as the planet warms further. This is most likely to cause short-term disruptions to economic growth in some EMs. What’s more, it could result in more …
6th September 2021
Although the US stock market’s valuation is nearly as high now as it was at the height of dot com mania, we don’t expect the return from it to be as bad in the next decade as it was in the 2000s. To re-cap, the return from a stock market index is …
31st August 2021
Although we forecast the greenback will rise further over the next year or two, we think that it will face growing headwinds over the longer term. As we set out in our first FX Markets Valuation Monitor , we think that the dollar is somewhat overvalued …
26th August 2021
Download the PDF for the full report. Our monthly Long Run Returns Monitor provides our updated long-term projected returns for major asset classes, as well as a summary of the macroeconomic forecasts which underpin them. All projections in this …
24th August 2021
Many countries are increasingly well-placed to ‘live with COVID’ and will be able to avoid the need for occasional lockdowns. However, this requires reaching and maintaining a high level of immunity in the community and there is a risk that this will be …
11th August 2021
Download the PDF for the full report. While emerging market equities have generally struggled since the previous edition of our Long Run Returns Monitor was published, most other asset classes have fared reasonably well. Most notably, government bond …
30th July 2021
Birth rates have fallen in several advanced economies during the pandemic. Although we think that fertility rates will bounce back and there won’t be material long-term impacts, this presents a small downside risk to some of our long run forecasts for …
23rd July 2021
Recent methodological changes by the UK statistics body highlight the difficulties of capturing productivity improvements in official economic data. Although the revisions will make only a small improvement to the UK’s productivity picture, they support …
14th July 2021
We expect some major central banks to issue digital currencies later this decade, with those in countries where cash is rarest proceeding the fastest. The first generation of central bank digital currencies (CBDCs) will be purposely designed not to shake …
6th July 2021
Revisions to the historic data following the recent census show that China’s population barely grew last year and that employment is already contracting faster than previously understood, having peaked in 2014 rather than 2017. The silver-lining, however, …
1st July 2021
Download the pdf for the full report . Given that the moves in most financial markets since the previous edition of our Long Run Returns Monitor have been fairly small–at least for the period as a whole –the returns that we are projecting from most assets …
24th June 2021
Global migration has ground to a halt over the past year or so, but we doubt that the pandemic will have any major lasting impact. Moreover, there is potential for migration to get a fresh impetus from a big rise in the number of people leaving Africa …
15th June 2021
Emerging markets as a whole will increase their share of global GDP over the coming decades, with the largest expansions likely to come in EMs with rapid population growth (sub-Saharan Africa), those with manufacturing sectors that can drive productivity …
3rd June 2021
Our monthly Long Run Returns Monitor provides an updated set of projections for the returns from major asset classes over the next few decades. Given that the period since the previous edition of this document has been a fairly quiet one for financial …
27th May 2021
While the consensus has become more optimistic about the near-term recovery, most analysts – and the majority of central banks – still believe that the pandemic will leave a legacy of lower global output over the long term. We disagree. And if we’re …
21st May 2021
There is typically more scope for female participation rates to rise and boost labour supply in EMs. This is particularly so in India and is one reason why we expect its economy to outperform in the long run. Increasing female labour force participation …
19th May 2021
The downward trend in average working hours in advanced economies has slowed or stalled in the past few decades. Yet there are reasons to think that the decline will resume, at least in some sectors and some countries. Other things equal, fewer hours …
13th May 2021
The 2020 US and China censuses add to the reasons why we think China will struggle to overtake the US as the world’s largest economy. China’s birth rate has continued to fall and the population will peak earlier than previously thought, so demographics …
11th May 2021
Download the pdf for the full report . Following their sharp rises earlier on in the year, government bond yields have steadied over the past few weeks. Perhaps reflecting this, both global equities and developed market (DM) REITs have generally rallied …
23rd April 2021
There is evidence that the pandemic has accelerated technology use, partly through increased equipment investment but mainly through a change in the way that people work. The effects on productivity might not be immediate or huge, but they will be …
16th April 2021
The rapid growth of the global labour supply in the past few decades looks set to give way to a period of much weaker growth. Some argue that this will reverse the decline in inflation seen in recent years as the bargaining power of labour rises and an …
24th March 2021
While the stock market fared much better than the economy in the US overall during the past ten years, we do not expect that to remain the case. A country’s stock market and its economy will grow at the same rate if there are no changes in the ratios of …
17th March 2021
We argued some time ago that globalisation had peaked and a period of deglobalisation might even lie ahead. It is now becoming clearer what to expect – namely a type of regionalism driven by the emergence of separate US-led and China-led spheres. While …
16th March 2021
One silver lining of the pandemic may be to accelerate the transformation to a “green” global economy. The related investment could boost demand, and possibly potential growth, in those countries introducing green stimulus measures. But it seems unlikely …
10th March 2021
In this first edition of the Long Run Returns Monitor we present an updated version of the projected returns from the major asset classes which feature in our annual Long Run Asset Allocation Outlook. The full report can be accessed by clicking on the …
5th March 2021
In light of our latest long-term economic and financial market forecasts, we have revisited our views for commercial property performance over the next three decades. We think that average returns will be lower than in the recent past, but that property …
1st March 2021
The equilibrium level of real interest rates in the global economy may not remain quite as low as of late, but we expect any rise to be gradual and small. With policymakers at the same time taking a more tolerant attitude towards inflation, actual real …
24th February 2021
Our long-run forecasts suggest that China will still be the second largest economy, measured at market exchange rates, in 2050. The most likely scenario is that slowing productivity growth and a shrinking workforce prevent China ever passing the US. But …
19th February 2021
The Long Run is a new subscription service offering insight into issues that will shape the global economy and financial markets over the next 30 years. This Update outlines our ten key calls for the coming decades. 1. Pandemic won’t permanently weaken …
17th February 2021
We anticipate that US equities will outperform long-dated Treasuries over the next ten years, even though the valuation of the stock market is even higher now than it was at the beginning of the 1930s and approaching its level at the outset of the 2000s – …
16th February 2021
We do not expect the pandemic to do permanent damage to global economic growth as vaccines allow activity to resume. There will be sustained behavioural changes, but these need not be negative. Note, for example, that technology use has accelerated in …
12th February 2021
In our Future of Property research, we identified important post-pandemic shifts in most real estate sectors. How these trends interact will be key to the outlook for the urban locations where most real estate is clustered. We think it is premature to …
4th February 2021
The pandemic – and the associated increase in working from home – may cause a fundamental shift in the way that cities function in future. But this shift will not necessarily trigger a more fundamental economic decline in the world’s largest urban …
5th January 2021
Korea’s population last year shrank for the first time in its history, underlining the seriousness of the demographic “time bomb” facing the country. The poor demographic outlook is the key reason why we expect trend growth in Korea to slow sharply over …
Climate change will be more costly to EMs than developed countries, with parts of Africa, as well as South and South East Asia most vulnerable to rising global temperatures. That said, some EMs could benefit as investments to mitigate climate change …
19th November 2020
The COVID pandemic will leave a profound economic legacy. But unlike previous crises, this will not necessarily manifest itself in much weaker rates of long-term economic growth. Instead, the economic legacy of the pandemic will be felt in changes to …
17th November 2020
The pandemic has increased the odds that the US will eventually experience a period of high inflation, principally because we expect the Fed to be less committed to ensuring price stability in the future. The higher public debt burden, slower global …
16th November 2020
