Long-term perspective on markets and economies

Expect strong but slowing economic growth in 2022

The global economy should enjoy solid growth in 2022, according to Capital Group economists. But clear risks lie ahead, including the gradual reduction of stimulus from central banks, stubborn inflation, a slowing China and the emergence of COVID variants.

U.S. OUTLOOK

U.S. economy is healthy, but inflation persists

The American economy should remain healthy in 2022 thanks to strong corporate profits and robust consumer spending, but inflation pressures and other headwinds will likely temper growth.

Pricing power can help companies fight inflation

Stocks and bonds have generally fared well in most inflationary environments. One strategy to consider is investing in companies with pricing power to help minimize inflation’s impact on investment returns.

INTERNATIONAL OUTLOOK

The digital revolution goes global

The outlook for international equity markets is brighter than it’s been in a long time, thanks to improving European economic growth, the expansion of the digital revolution beyond U.S. shores and the restoration of dividends by companies throughout the world.

Dividends stage a comeback of global proportions

A broad range of companies with a history of paying meaningful and growing dividends can be found in markets across the globe.

FIXED INCOME OUTLOOK

Maintain balance with bonds

With equity market volatility surfacing and many assets priced for perfection, fixed income has the potential to provide important diversification to investor portfolios.

In a challenging bond market, it’s all about selectivity

History shows that high-quality fixed income can often generate positive returns even as rates rise. That’s where selectivity comes in.