Economic Outlook Q4: Heading Into Another Global Slowdown As Inflation Remains High

MIDF Investment expects the global growth to moderate to 3% this year, as the low base effect wanes, the pace of growth this year will be back to more normalized levels after the robust +6.1% rebound last year.

MIDF Investment预计，随着低基数效应的减弱，今年的全球增长率将放缓至3%，今年的增长速度将在去年强劲的+6.1%反弹后恢复到更正常的水平。

After two years of battling the Covid-19 pandemic, improved public health and increased vaccination rate allowed countries to ease Covid-19 restrictions. The post-pandemic economic reopening, therefore, will result in increased consumer spending and business activities. Businesses will increase hiring and production to cope with the growing demand. Nevertheless, producers continued to indicate experiencing post-pandemic challenges such as rising prices and costs, shortage of raw materials and labour, and other supply constraints. Although the ongoing war in Ukraine remains one of the uncertainties affecting the global growth outlook, the recent correction in the global commodity prices at least signal stabilisation in global supply chain condition.

经过两年与Covid-19大流行的斗争，公共卫生状况的改善和疫苗接种率的提高使各国能够放宽Covid-19的限制。因此，大流行后的经济重新开放将导致消费者支出和商业活动的增加。企业将增加招聘和生产，以应对不断增长的需求。然而，生产商继续表示正在经历大流行后的挑战，例如价格上涨和成本上升，原材料和劳动力短缺以及其他供应限制。尽管乌克兰正在进行的战争仍然是影响全球增长前景的不确定性之一，但最近全球大宗商品价格的调整至少标志着全球供应链状况的稳定。

Several factors that emerged led to a downgrading of the global growth outlook for this year. While the war in Ukraine and the reintroduction of Covid-19 lockdown in China had led to a downward revision to the global growth outlook, the continued tightening of monetary policy by central banks in many countries (including major economies like the US, euro area, and UK) has caused a shift in the narrative that the global economy may be experiencing slowing growth momentum heading into 2023.

出现的几个因素导致今年全球增长前景下调。虽然乌克兰战争和中国重新引入Covid-19封锁导致全球增长前景下调，但许多国家（包括美国，欧元区和英国等主要经济体）央行继续收紧货币政策，导致全球经济可能正在经历放缓的增长势头进入2023年的说法的转变。

For many countries, inflation has been trending upward due to the rise in commodity prices, affecting global prices of food and energy. Although the concerns to a certain extent eased due to the recent correction in commodity prices, the level of commodity prices remained elevated compared to previous years. This will still result in higher inflation this year, which can be explained by the recovery in demand after post-pandemic economic reopening and the supply constraints faced by producers to cope with robust demand.

对许多国家来说，由于商品价格上涨，通货膨胀一直呈上升趋势，影响了全球粮食和能源价格。虽然由于最近商品价格的调整，人们的关切在一定程度上有所缓解，但与前几年相比，商品价格水平仍然较高。这仍将导致今年的通胀上升，这可以解释为大流行后经济重新开放后需求复苏以及生产商为应对强劲需求而面临的供应限制。

MIDF projects crude palm oil price to average higher this year at RM5,000 per tonne (2021: RM4,437/tonne) and Brent crude oil to be around USD105pb (2021: USD70.90pb) this year. While inflation remains the major focus affecting consumer and business sentiment globally, the global slowdown fear at least helped to ease upward price pressures. The concerns over a weaker demand outlook have helped to bring down commodity prices from the recent highs.

MIDF预计今年棕榈油平均价格将上涨至每吨5，000令吉（2021年：4,437令吉/吨），布伦特原油今年将约为105亿美元（2021年：70.90亿美元）。虽然通胀仍然是影响全球消费者和企业信心的主要焦点，但全球经济放缓的担忧至少有助于缓解价格上涨压力。对需求前景疲软的担忧有助于将大宗商品价格从近期高点压低。

Central banks have started to raise interest rates to contain inflationary pressures through slowing demand. MIDF foresees central bank will remain hawkish throughout this year as inflation remained at high levels, with more rate hikes to be considered until there is a considerable decline in inflation as well as reduced pressures from strong demand.

各国央行已开始提高利率，通过需求放缓来遏制通胀压力。MIDF预计，由于通胀率保持在高位，央行今年仍将保持鹰派态度，在通胀大幅下降以及强劲需求压力减轻之前，需要考虑加息更多。

Although inflation remains the major focus among policymakers, the rapid rise in borrowing costs will pose near-term pains that will cause consumers and businesses to slow down spending and eventually contribute to slower inflationary pressures.

尽管通胀仍然是政策制定者的主要关注点，但借贷成本的迅速上升将带来近期的痛苦，这将导致消费者和企业放缓支出，并最终导致通胀压力放缓。

The balance of risks to the global growth outlook remains on the downside. Several risks that could affect the stability of global growth are the continued rise in global inflation, the slow growth in China, renewed disruption to global supply, and escalation of geopolitical tensions (including the ongoing Russia-Ukraine war and recent ChinaTaiwan tension). The global Covid-19 pandemic has been less of a concern as countries moved to reopen their economies and international borders, but cannot rule out the possibility of reintroduction of tight containment measures should the public health condition worsens again.

全球经济增长包括全球通胀的持续上升，中国增长缓慢，全球供应再次中断，以及地缘政治紧张局势升级（包括正在进行的俄罗斯 - 乌克兰战争和最近的中国台湾紧张局势）。随着各国重新开放经济和国际边界，全球Covid-19大流行已不那么令人担忧，但不能排除在公共卫生状况再次恶化时重新引入严格遏制措施的可能性。

Looking at recent developments, another factor that could affect global growth is the increased volatility in the financial market. The elevated inflation especially in the US has led to expectations for further aggressive policy tightening. As the recession risk has not been ruled out, slowing demand will likely hurt the global growth outlook which could begin as early as in the final quarter of 2022. Not to forget, severe and extreme weather conditions could also affect economic activities in countries affected by floods, hurricanes, wildfires and even extreme cold winter.

从最近的事态发展来看，另一个可能影响全球增长的因素是金融市场的波动性增加。通胀上升，尤其是美国通胀，导致人们预期将进一步收紧政策。由于尚未排除经济衰退风险，需求放缓可能会损害全球增长前景，而全球增长前景最早可能在2022年最后一个季度开始。不要忘记，恶劣和极端的天气条件也可能影响受洪水，飓风，野火甚至极端寒冷冬季影响的国家的经济活动。