We’re now in the last quarter of 2021. While the Delta variant continues to cause resurgent infections across the world, the global economy is in a much better state than it was last year. But after a rapid recovery, what’s next for global markets?

Global growth is slowing

The global recovery is slowing. This is to some extent natural after the sharp V-shaped recovery we have seen in the first half of 2021.

In the US, supply-chain bottlenecks, inflation, and worries over the Delta variant are weighing on businesses. Meanwhile, US job growth in August disappointed, with just 235,000 jobs added against expectations of 750,000.

The US Federal Reserve is also set to begin tapering its asset purchases in the coming months.

Amid this confluence of factors, the Fed lowered its projections for US GDP growth in 2021 to 5.9% from 7% previously, while GDP growth for 2022 was lifted to 3.8% from 3.3% before.