Global Markets Overview: November 2021

In this month’s Global Markets Overview:

Key Points for November

• Inflation has risen sharply; we still expect it to slow equally sharply in the second half of 2022.
• Measures of prices rose sharply in October in the major economies. The U.S. headline Consumer Prices Index (CPI) jumped 6.2% from a year ago – the highest rate since December 1990. In Europe, the CPI rose by 4.1% and 4.2% in the 12 months to October, for the Eurozone and UK respectively.
• The main drivers of high inflation still look to be short-term, e.g., rising commodity and electricity prices, the reversal of COVID-19 stimulus-related tax cuts, and rising global goods prices from supply-chain bottlenecks.
• Central bank guidance has become more tilted towards increasing policy rates, especially in the US and UK, in the face of above-target inflation and robust growth. Nevertheless, we expect the rise in short-term interest rates to be gradual, as inflation pressures fade.

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Author

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David Hoile

Global Head of Asset Research at WTW

David is the Global Head of Asset Research at WTW, responsible for economic and capital market research. He also is a member of the Investment Assumptions Committee, who help guide investment policy globally.

email Email phone +44 20 7170 2144

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