Macro Outlook

AndPapers Q1 2022 | Normalisation in a post-pandemic world

By Investment Desk | 19 Jan, 2022

2021 featured a fast rebound in economic activity as vaccines allowed for progressive re-openings, so global output is almost back to pre-pandemic levels.

Despite an upturn in Delta infections (and the more recent emergence of Omicron), economic growth remains well above longer-term trends across the major economies.

Growth projections show a gradual slowdown throughout 2022, reverting to pre-Covid growth rates by 2023.

Consumers hold the key to the growth outlook. In theory they hold unprecedented cash, thanks to savings generated through the Covid-19-driven plunge in spending, direct stimulus payments and enhanced unemployment benefits.

This is clear for households in the middle- and higher-income groups, especially homeowners. These are in much better financial shape than before the pandemic, although there is great uncertainty about the speed and extent to which they will choose to run down those excess savings.

The picture for lower income households is much less flattering: they received temporary respite in the form of fiscal stimulus (unemployment cheques and the like), but their stock of savings is much lower. Therefore, they are much more vulnerable to future shocks, including the continuous loss of purchasing power if their wages do not keep up with inflation.

To read the full AndPapers Q1 2022 click here


To get in contact with London & Capital, please give us a call on +44 (0) 207 396 3388 or get in contact here.


Disclaimer: The value of investments and any income from them can fall as well as rise and neither is guaranteed. Investors may not get back the capital they invested. Past performance is not indicative of future performance. The material is provided for informational purposes only. No news or research item is a personal recommendation to trade. Nothing contained herein constitutes investment, legal, tax or other advice. Copyright © London and Capital Asset Management Limited. London and Capital Asset Management Limited is authorised and regulated by the Financial Conduct Authority of 12 Endeavour Square, London E20 1JN, with firm reference number 143286. Registered in England and Wales, Company Number 02112588. London and Capital Wealth Advisers Limited is authorised and regulated by both by the Financial Conduct Authority of 12 Endeavour Square, London E20 1JN, with firm reference number 120776 and the U.S. Securities and Exchange Commission of 100 F Street, NE Washington, DC 20549, with firm reference number 801-63787. Registered in England and Wales, Company Number 02080604.

Related Content