2022 Year Ahead Outlook

BofA Global Research analysts share key themes, views and forecasts for the year ahead.

Michael Hartnett

Ethan Harris

Francisco Blanch

Market outlook and investment strategy

Key takeaways:

  • Video 1: Due to growing inflation we believe a rates shock will dampen both equities and bonds.
  • Video 2: Higher rates and lower corporate earnings are a negative backdrop for asset markets.
  • Video 3: Corporations investing more in their workers will be a key theme over the next decade.

“And really if you think about 2021, the main theme was an inflation shock. And by nature, that should be followed by a rates shock, which we think will be the key theme going into 2022.”

Video 1: Investment Outlook for 2022 | Download transcript

Video 2: Bonds & Stocks in 2022 | Download transcript

Video 3: Expectations for CapEx Recovery | Download transcript

Section

U.S. economics

Key takeaways:

  • Video 1: Continued re-engagement and sustained spending could lead to a strong 2022.
  • Video 2: A number of upside and downside risks could impact economic growth.
  • Video 3: Rising inflation may lead to rising interest rates throughout the coming years.
  • Video 4: A recovering job market and healthy wage growth lead to an ongoing robust labor market.

“Another reason to expect strong growth is there’s a lot of left over money from last year where people accumulated stimulus checks…. They were now able to deploy that, going forward, to sustain strong spending.”

Video 1: Outlook for Growth in 2022 | Download transcript

Video 2: Upside & Downside Risks | Download transcript

Video 3: Inflation and Fed Policy | Download transcript

Video 4: Wage Gains | Download transcript

Section

Global commodities

Key takeaways:

  • Video 1: An inflation tailwind will continue to help commodity markets push higher.
  • Video 2: With a tightening monetary policy we expect a robust outlook.
  • Video 3: There are three reasons why commodity prices will not slow down the global economy.

“First, we have a positive demand shock unfolding. After COVID, everyone wants to travel, drive, fly, move around and continue to consume more things, so all of that is going to be supportive of energy prices.”

Video 1: Commodity Prices | Download transcript

Video 2: Monetary Policy | Download transcript

Video 3: Increases in Energy Prices | Download transcript