Despite an extended pandemic and the uncertainty that comes with it, the economy and financial markets performed admirably in 2021. Stock returns exceeded expectations, rewarding investors with another year of excellent growth. As we enter 2022, we believe the economy is poised for another year of solid growth as the recovery transitions from stimulus-driven to one based on traditional fundamentals.
- Following a very strong recovery in 2021, U.S. economic growth is expected to slow but remain robust. We expect GDP growth to exceed 4% in 2022.
- Consumer spending will continue to drive the economy. Despite record high home prices, the housing sector should continue to grow faster than the overall economy.
- Supply chain disruptions and a shrinking labor market have pushed inflation to the highest annualized level in nearly 40 years. We expect these pressures to ease in 2022. Inflation levels will remain elevated but closer to normal as the year progresses.
Hear From Our Team
Listen in as Jason Herried and Ron Alberts discuss the economy and our outlook on the fixed income and equity markets. They wrap up with how we are currently positioning portfolios.
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