BofA Global Research with the note:
The impact of Covid on the economy has evolved over time. Here we argue Omicron adds a new chapter to the Covidonomics textbook:
- Successive waves of Covid are increasingly impacting the supply-side of the economy more than the demand-side.
- The biggest impact from Omicron will likely be a large temporary loss of workers due to quarantines.
- The upshot is to extend the period of tight capacity and inflation pressure and add another nudge to Fed rate hikes.