After six months of weathering an environment of rising rates, rising inflation and geopolitical tensions, fears of a recession are rising, dimming the outlook for markets and the global economy in the second half of 2022, as well as indicate the results of the semi-annual survey among 34 market strategists and economists of Natixis Investment Managers and 15 of its affiliated investment managers.
Findings from the biannual survey show that 24% think a recession is inevitable, while another 64% see a recession as a distinct possibility in the next six months.
It shows that 9 out of 10 strategists believe that central bank policy will be the biggest driver of the market in the next six months
“The biggest driver for the market in late 2022 will be central banks and inflation control to lower the long-term cost of capital,” says Katy Kaminski, Chief Research Strategist and Portfolio Manager, Alpha Simplex Group.
When it comes to inflation, the survey results see it as the biggest risk for the market in the second half. Although it has slightly decreased from its maximum, 36% of those surveyed even go so far as to place the risk level at 10.
“52% see monetary policy decisions as a key driver of inflation. Another 46% also believe that the supply chain issues that helped drive inflation early in the pandemic will continue to do the same through the end of the year.
