Goldman Sachs’ Global Economics Analyst has released its top 12 charts of 2021.
Below is the overview:
The global economy recovered rapidly in 2021 as demand surged. Mass vaccinations and adaptation made growth less sensitive to infections although risk aversion to the virus remained high in Asia-Pacific for much of the year. Fiscal policy turned from a large boost in the spring into a modest drag in the US. However, policy remains more expansionary in the Euro Area.
Following this very rapid rebound in demand, our short-run output gaps tightened into overheating territory in the UK and, to a lesser degree, in the Euro Area, and the US. Labor shortages boosted wage growth in the US and the UK, which remained softer in the Euro Area. The biggest surprise of the year was the global inflation surge, which was particularly pronounced for US goods, global energy, and Latin America.
As a result, G10 central banks tapered or ended asset purchases earlier than expected. The interest rate normalization process started in Norway, New Zealand, the UK, and much of Latin America and CEEMEA, and is set to broaden and deepen in 2022.
And below are the 12 charts presented in order: