The biggest risks to markets in 2022 would be inflation, coronavirus and geopolitical tensions, according to about 700 respondents to the Markets Live Global Survey.
More than 30% of those interviewed mentioned inflation as one of their biggest concerns when asked: “What do you think is the greatest tail risk for markets in 2022 and how likely do you think it is that it will occur?”. Respondents often linked the risks of higher inflation to central banks that lagged behind the curve or adjusted their monetary policy too quickly.
More than a quarter were concerned about the coronavirus and almost half of them focused on a new variant. The most detailed responses cited governments imposing new restrictions or central banks adjusting their policies in response to the health crisis.
About 23% of those surveyed cited geopolitical tensions and 16% specifically used the terms war, invasion or conflict. The main examples given were the growing tensions between China Y Taiwan, and Russia and Ukraine, in particular the possibility of an invasion. Any escalation in either case was seen as the prelude to a greater conflict that would involve more countries.
The fourth highest tail risk, with 13% of responses, was the Federal Reserve, particularly the possibility that the US central bank will tighten interest rates too quickly. More generally, 10% said that policy errors were a tail risk.
While 5% cited the risks associated with central banks globally, responses were divided on the likelihood of policymakers lagging behind or overreacting to inflation.
:quality(75)/cloudfront-us-east-1.images.arcpublishing.com/elcomercio/BVR2AM5UZZB3FLNCZK7VW57YBQ.jpg)
Regarding China, respondents saw both geopolitical and domestic risks. The contagion linked to the economic situation of China It was frequently cited and the potential for slower growth and an impact on the housing market was mentioned.
Some other risks cited included: supply chain (~ 5%), cryptocurrencies (4%), and stagflation (2.6%).
The survey Markets Live Global Survey, conducted from December 5 to 18, included 873 respondents. Of these, 44% lived in North America, 37% in Europe and 10% in Asia. The top three jobs for respondents were portfolio manager (35%), researcher / strategist / economist (15%), and purchasing operator (12%).
The methodology used in the analysis of the 672 responses to the tail risk question included counting the frequency of the terms and calculating the percentages versus the number of responses to this question. The details were then manually analyzed.
.
Ricardo is a renowned author and journalist, known for his exceptional writing on top-news stories. He currently works as a writer at the 247 News Agency, where he is known for his ability to deliver breaking news and insightful analysis on the most pressing issues of the day.
