through pay raises granted in 2021 and planned for early 2022. The response? Central banks in most developed markets, including the U.S. Federal Reserve, plan to raise borrowing rates in the near term and start pulling out cash flooded into financial markets through previous bond purchases. Monetary interventions have a lagging effect, so constraints and inflation may worsen before reversing course.
The biggest X-factor for 2022 is, of course, China. Continued pressure on Taiwan, expansionist moves in East Asia and internal pressure on corporations to support the government’s “common prosperity” goal will certainly have spillover impacts on corporate supply chains serving these markets.
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