“Central banks reducing emergency stimulus too quickly and further supply chain disruption are among the top risks to the world economy next year as the COVID-19 pandemic lingers,” per the latest Reuters poll covering more than 500 economists from around the world.
The survey results also highlight a shift in the economists’ view, contrasting the top central bankers who term that the recent surge in inflation as transitory. Even so, “Some stock markets are trading close to record highs even as interest rates are now on the rise,” adds the poll.
Reuters polls covering more than 500 economists from around the world concluded that 13 of 25 central banks would raise interest rates at least once before the end of next year. Some already have, like central banks of New Zealand, Russia and Brazil.
But about one-quarter of 171 economists responding to an extra question said central banks dialing down stimulus too quickly was one of the biggest downside risk to the global economy.
A similar number of respondents said more supply chain disruptions or flare-ups in the COVID-19 pandemic, set to enter its third year in 2022 as a much-diminished but still not vanquished threat, were the top risks.
Indeed, global growth was expected to slow to 4.5% next year from a blistering 5.9% this year, largely unchanged from July. That slowdown next year is a bit sharper than International Monetary Fund's (IMF) latest projection of 4.9%.
Growth was forecast to slow to around that pace in 2023, at 3.5%, according to the poll.
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