What to watch for next year

As the end of 2021 approaches, it’s time to start thinking about the future. What’s going to happen in 2022? The answer is unclear, but there are a few big risks to keep an eye on….

#1 The effect of omicron 🦠

We don’t have conclusive information on omicron yet – while it seems more infectious than previous variants, it also might be less deadly. 

  • But… if evidence shows the virus is more deadly, countries are likely to go back into lockdown, dragging down the economy.
  • Some estimate the UK’s growth next year could slow to 4.2%, down from an estimated 6.5% in 2021.

#2 My stuff is getting expensive 💸

Inflation is a big concern. The US thought that it would end 2021 with 2% inflation, but instead, it’s nearly 7%. While some forecasts predict inflation should drop soon, a further price increase is possible.

  • Climate change could continue to disrupt crops, pushing up food prices – we’ve seen it happen with coffee and wheat already. (Our wheat story here)

#3 Could China slow down? 🐌

China’s economy has been dragged down by issues like covid lockdowns, energy shortages, and the slowing property market. As we get into 2022 though, these problems could continue.

  • As China maintains a zero-Covid strategy, lockdowns may affect its growth if omicron makes its way into the country.
  • The property market is especially concerning, as sales from developers have fallen in the past 5 months – 1/4th of China’s economy comes from real estate. 

That sounds quite worrying 😬 True…but there are a few good signs. 

  • Households have more savings than normal due to not spending much during lockdowns – the economy could recover quickly if the money is spent. 
  • Governments like China have already pledged to support their economies (more on that here

🐿️: Who knows what the future holds? I hope it’ll be a good year! 

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