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A New Global Outlook

Published This article is more than 2 years old.
  • Business is changing

    Sustainability, once considered a nice-to-have, is now a real-estate imperative that averts future risks, prepares businesses to manage changing regulations, and adds recognisable business value.

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  • Globalization Rewired

    Covid-19 has accelerated geopolitical trends such as a bipolar U.S.-China world order.

    We are likely to see an increased emphasis in both countries on seeking self sufficiency in critical industries of the future. This is why we believe investors need exposure to both poles of global growth. 

    Learn more about our global 2021 outlook here.

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    The pandemic has added fuel to pre-existing structural trends such as an increased focus on sustainability, rising inequality, and the dominance of e-commerce.

    Strategic implication: We prefer sustainable assets amid a growing societal preference for sustainability.

    The euro area, for example, is putting green infrastructure and digitalization spending at the center of its economic restart efforts – helping speed up the transition to a low-carbon economy. 

    Learn more about our global 2021 outlook here.

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    We see stronger growth and lower real yields ahead as the restart accelerates and central banks limit the rise of nominal yields – even as inflation expectations climb. 

    Two things for investors to keep in mind: 

    • Central banks have signaled they will be more willing to let economies run hot with above-target inflation by changing their policy frameworks to make up for prior inflation undershoots. 
    • At the same time, the fiscal-monetary policy revolution risks greater political constraints on central banks’ ability to lean against inflation. We see central banks likely curbing nominal yield rises to prevent an unwanted tightening of financial conditions. 

    Learn more about our global 2021 outlook here.

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