The big policy questions for 2022

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Market Volatility and Polar Splits Among ‘The Big Three’ Policy-Makers Will Be the Stories of 2022

 

On paper, Central Bank Liquidity, the dominant driver of Global Liquidity over the past decade and particularly since COVID, looks set to slow markedly in 2022. Policy indications from both the US Fed and the ECB even point to absolute falls in balance sheet size from mid-year. Meanwhile, China is maintaining a stable course, albeit at a low ebb. We suspect that rising market volatility will cause some policy-makers to reverse their planned QE tapers. To us, the US Fed looks most likely to fold first.

 

 

See our latest published research, Global View - Market Volatility and Polar Splits Among ‘The Big Three’ Policy-Makers Will Be the Stories of 2022 - December 2021

 

 

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